Harold Corp uses the job order costing system. Factory overhead is applied to jobs on the basis of direct labor cost. The following estimates are made at the beginning of the year: Fabricating Machining Assembly Total Direct Labor 600,000 300,000 900,000 1,800,000 Fcatory overhead 1,050,000 1,200,000 270,000 2,520,000 The following are the cost required by each department. Fabricating Machining Assembly Total Direct Materials 9,000 600 4,200 13,800 Direct Labor 8,400 1,500 18,600 28,500 Factory overhead ? ? ? ? At the end of the year, the following are the actual cost data relating to all jobs processed during the year: Fabricating Machining Assembly Total Direct Materials 570,000 48,000 342,000 960,000 Direct Labor 630,000 324,000 786,000 1,740,000 Factory overhead 1,080,000 1,260,000 252,000 2,592,000 Required: Compute the over or under- applied factory overhead for the year (1) assuming the plant wide overhead rate is used (2) assuming the departmental overhead rates are used.
Harold Corp uses the
Fabricating Machining Assembly Total
Direct Labor 600,000 300,000 900,000 1,800,000
Fcatory overhead 1,050,000 1,200,000 270,000 2,520,000
The following are the cost required by each department.
Fabricating Machining Assembly Total
Direct Materials 9,000 600 4,200 13,800
Direct Labor 8,400 1,500 18,600 28,500
Factory overhead ? ? ? ?
At the end of the year, the following are the actual cost data relating to all jobs processed during the year:
Fabricating Machining Assembly Total
Direct Materials 570,000 48,000 342,000 960,000
Direct Labor 630,000 324,000 786,000 1,740,000
Factory overhead 1,080,000 1,260,000 252,000 2,592,000
Required:
Compute the over or under- applied factory overhead for the year (1) assuming the plant wide overhead rate is used (2) assuming the departmental overhead rates are used.
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