The Pacific Manufacturing Company operates a job-order costing system and applies overhead cost to jobs on the basis of direct labor cost. Its predetermined overhead rate was based on a cost formula that estimated $117,000 of manufacturing overhead for an estimated allocation base of $90,000 direct labor dollars. The company has provided the following data:
Inventories Beginning Ending
Raw materials $ 25,000 $ 15,000
Work in process $ 44,000 $ 38,000
Finished goods $ 75,000 $ 62,000
The following actual costs were incurred during the year:
Purchase of raw materials (all direct) $ 135,000
Direct labor cost $ 86,000
Actual manufacturing overhead costs:
Insurance, factory $ 10,500
Depreciation of equipment $ 15,000
Indirect labor $ 38,200
Property taxes $ 8,800
Maintenance $ 13,000
Rent, building $ 31,000
Required:
1-a.
Compute the predetermined overhead rate for the year.
Predetermined overhead rate %
1-b. Compute the amount of underapplied or overapplied overhead for the year. (Input the amount as a positive value.)
(Click to select) Overapplied Underapplied overhead $
2. Prepare a schedule of cost of goods manufactured for the year. Assume all raw materials are used in production as direct materials. (Input all amounts as positive values.)
Pacific Manufacturing Company
Schedule of Cost of Goods Manufactured
Direct materials:
(Click to select) Work in process, ending Raw materials inventory, beginning Raw materials inventory, ending Manufacturing overhead
applied to work in process Work in process, beginning $
(Click to select) Deduct Add : (Click to select) Work in process, ending Work in process, beginning Raw materials inventory, ending
Purchases of raw materials Cost of goods manufactured
Total raw materials available
(Click to select) Deduct Add : (Click to select) Work in process, ending Raw materials inventory, ending Work in process, beginning Raw
materials inventory, beginning Purchases of raw materials
Raw materials used in production $
(Click to select) Work in process, beginning Direct labor Raw materials inventory, ending Purchases of raw materials Work in process, ending
(Click to select) Work in process, ending Work in process, beginning Purchases of raw materials Raw materials inventory, ending Manufacturing overhead applied to work in process
Total manufacturing cost
(Click to select) Add Deduct : (Click to select) Work in process, beginning Work in process, ending Raw materials inventory ending Raw
materials inventory, beginning Purchases of raw materials
(Click to select) Add Deduct : (Click to select) Work in process, ending Raw materials inventory, beginning Raw materials inventory, ending Work in process, beginning Purchases of raw materials
Cost of goods manufactured $
3. Compute the unadjusted cost of goods sold for the year. (Do not include any underapplied or overapplied overhead in your cost of goods sold figure.)
Unadjusted cost of goods sold $
4. Job 137 was started and completed during the year. What price would have been charged to the customer if the job required $3,200 in materials and $4,700 in direct labor cost, and the company priced its jobs at 60% above the job%u2019s cost according to the accounting system?
Price to customer $
5. Direct labor made up $8,400 of the $38,000 ending Work in Process inventory balance. Supply the information missing below:
Direct materials $
Direct labor 8,400
Manufacturing overhead
Work in process inventory $ 38,000