Question: Net Play Company uses a job order
Net Play Company uses a job order cost system in each of its three manufacturing departments. Manufacturing overhead is applied to jobs on the basis of direct labor cost in Department A, direct labor hours in Department B, and machine hours in Department C.
In establishing the predetermined overhead rates for 2014, the following estimates were made for the year
During January, the job cost sheets showed the following costs and production data.
Instructions:
(a) Compute the predetermined overhead rate for each department.
(b) Compute the total manufacturing costs assigned to jobs in January in each department.
(c) Compute the under- or overapplied overhead for each department at January 31.
Transcribed Image Text:
Department A B Manufacturing overhead Direct labor cost $720,000 $600,000 50,000 100,000 $640,000 $100,000 40,000 120,000 $900,000 $600,000 Direct labor hours Machine hours 40,000 150,000 Department А B $92,000 $48,000 $60,000 4,000 Direct materials used Direct labor cost $86,000 $35,000 $60,000 3,500 $64,000 $50,400 $72,100 4,200 Manufacturing overhead incurred Direct labor hours Machine hours 8,000 10,500 12,600
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