Chapter 15 - Hard Calculation

Calloway Manufacturing allocates overhead to production on the basis of direct labor costs. At the beginning of the year, Adams estimated total overhead of $396,000; materials of $410,000 and direct labor of $220,000. During the year Adams incurred $418,000 in materials costs, $413,200 in overhead costs and $224,000 in direct labor costs. Compute the amount of under- or overapplied overhead for the year.

• $10,000 underapplied.

• $17,200 underapplied.

• 
  $4,800 underapplied.

• $17,200 overapplied.

Harlin Manufacturing allocates overhead to production on the basis of direct labor costs. At the beginning of the year, Adams estimated total overhead of $396,000; materials of $410,000 and direct labor of $220,000. During the year Adams incurred $418,000 in materials costs, $413,200 in overhead costs and $224,000 in direct labor costs. Compute the amount of overhead applied to jobs during the year.

• $413,190.

• $403,200.

• $396,000.

• $424,450.

King Manufacturing allocates overhead to production on the basis of direct labor costs. At the beginning of the year, Adams estimated total overhead of $396,000; materials of $410,000 and direct labor of $220,000. During the year Adams incurred $418,000 in materials costs, $413,200 in overhead costs and $224,000 in direct labor costs. Compute the predetermined overhead rate.

• 55.6%.

• 96.6%.

• 180.0%.

• 184.0%.

Finished goods inventory is $195,000. If overhead applied to these goods is $74,000, and the overhead rate is 110% of direct labor, how much direct materials cost was incurred in producing the inventory?

Note: Round your intermediate calculations and final answer to nearest whole dollar.

• $39,600.

• $81,400.

• $67,273.

• $53,727.

Zorsch Center pays an average wage of $12 per hour to employees for printing and copying jobs and allocates $18 of overhead for each employee hour worked. Direct materials are assigned to each job according to actual cost. Jobs are marked up 20% above total manufacturing cost to determine the selling price. If Job M-47 used $350 of direct materials and took 20 direct hours of labor to complete, what is the selling price of the job?

• $720

• $708

• $1,140

• $456

The Work in Process Inventory account of a manufacturing company has a $7,305 debit balance. The company applies overhead using direct labor cost. The cost sheet of the only job still in process shows direct material cost of $2,700 and direct labor cost of $1,500. Therefore, the company's predetermined overhead rate is:

• 207% of direct labor cost.

• 115% of direct labor cost.

• 48% of direct labor cost

• 56% of direct labor cost.

CWN Company uses a job order costing system and last period incurred $83,000 of actual overhead and $100,000 of direct labor. CWN estimates that its overhead next period will be $72,000. It also expects to incur $100,000 of direct labor cost. If CWN bases applied overhead on direct labor cost, its predetermined overhead rate for the next period should be:

• 115%.

• 72%

• 120%.

• 139%.