Yarra Fabrication estimates that its manufacturing overhead will be $2,240,000 in year 1. It further estimates that direct material costs will amount to $1,400,000. During July, Yarra worked on four jobs with actual direct materials costs of $60,000 for Job 0701, $40,000 for Job 0702, $55,000 for Job 0703, and $35,000 for Job 0704. Actual manufacturing overhead costs for the year were $2,400,000. Actual direct materials costs were $1,550,000. Manufacturing overhead is applied to jobs based on direct materials cost using predetermined rates. Required: a. How much overhead was applied to each of the four jobs, 0701, 0702, 0703, and 0704? b. What was the over- or underapplied manufacturing overhead for year 1?

Yarra Fabrication estimates that its manufacturing overhead will be $2,240,000 in year 1. It further estimates that direct material costs will amount to $1,400,000. During July, Yarra worked on four jobs with actual direct materials costs of $60,000 for Job 0701, $40,000 for Job 0702, $55,000 for Job 0703, and $35,000 for Job 0704. Actual manufacturing overhead costs for the year were $2,400,000. Actual direct materials costs were $1,550,000. Manufacturing overhead is applied to jobs based on direct materials cost using predetermined rates. Required: a. How much overhead was applied to each of the four jobs, 0701, 0702, 0703, and 0704? b. What was the over- or underapplied manufacturing overhead for year 1?

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter2: Job Order Costing

Section: Chapter Questions

Problem 4CMA: Patterson Corporation expects to incur 70,000 of factory overhead and 60,000 of general and...

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Steeler Towel Company estimates its overhead to be $250,000. It expects to have 100,000 direct labor hours costing $2,500,000 in labor and utilizing 12,500 machine hours. Calculate the predetermined overhead rate using: A. Direct labor hours B. Direct labor dollars C. Machine hours
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