Calculation of applied manufacturing overhead based on direct labor hour rate.

1. Baka Corporation applies manufacturing overhead on the basis of direct labor-hours. At the beginning of the most recent year, the company based its predetermined overhead rate on total estimated overhead of $239,700 and 4,700 estimated direct labor-hours. Actual manufacturing overhead for the year amounted to $242,000 and actual direct labor-hours were 4,600.

The applied manufacturing overhead for the year was closest to:

a.         $234,600

b.        $229,586

c.         $236,854

d.        $242,006

2. On November 1, Arvelo Corporation had $32,000 of raw materials on hand. During the month, the company purchased an additional $78,000 of raw materials. During November, $95,000 of raw materials were requisitioned from the storeroom for use in production. These raw materials included both direct and indirect materials. The indirect materials totaled $3,000.

Prepare journal entries to record these events. Use those journal entries to answer the following questions:

The debits to the Raw Materials account for the month of November total:

a.         $78,000

b.        $32,000

c.         $95,000

d.        $110,000