Problem:
| Aquatic Maufacturing |
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Estimated Predetermined overhead rates |
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Department |
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A |
B |
C |
| Manufacturing Overhead |
$930,000.00 |
$800,000.00 |
$750,000.00 |
| Direct labor cost |
$600,000.00 |
$100,000.00 |
$600,000.00 |
| Direct labor hours |
$ 50,000.00 |
$ 40,000.00 |
$ 40,000.00 |
| Machine hours |
$100,000.00 |
$120,000.00 |
$150,000.00 |
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January job cost sheets |
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Department |
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A |
B |
C |
| Direct materials used |
$ 92,000.00 |
$ 86,000.00 |
$ 64,000.00 |
| Direct labor cost |
$ 48,000.00 |
$ 35,000.00 |
$ 50,400.00 |
| Manufacturing overhead incurrred |
$ 76,000.00 |
$ 74,000.00 |
$ 61,500.00 |
| Direct labor hours |
$ 4,000.00 |
$ 3,500.00 |
$ 4,200.00 |
| Machine hours |
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$ 8,000.00 |
$ 10,500.00 |
$ 12,600.00 |
(a) Compute the predetermined overhead rate for each department
Department A overhead is applied on direct labor cost
Department B overhead is applied on direct labor hours
Department C overhead is applied on machine hours
(b) Compute the total manufacturing cost assigned to jobs in January in each department.
(c) Compute the under/over applied overhead for each department at January 31.