Please I need help answering this problem

O’Leary Corporation manufactures special purpose portable structures (huts, mobile offices, and so on) for use at construction sites. It only builds to order (each unit is built to customer specifications). O’Leary uses a normal job costing system. Direct labor at O’Leary is paid $30 per hour, but the employees are not paid if they are not working on jobs. Manufacturing overhead is assigned to jobs by a predetermined rate on the basis of direct labor-hours. The company incurred manufacturing overhead costs during two recent years (adjusted for price-level changes using current prices and wage rates) as follows.

Year 1

Year 2

Direct labor-hours worked

69,600

56,600

Manufacturing overhead costs incurred

Indirect labor

$

2,864,000

$

2,264,000

Employee benefits

1,044,000

849,000

Supplies

696,000

566,000

Power

653,000

548,000

Heat and light

143,200

143,200

Supervision

783,790

664,050

Depreciation

2,060,500

2,060,500

Property taxes and insurance

803,510

829,250

Total manufacturing overhead costs

$

9,048,000

$

7,924,000

At the beginning of year 3, O’Leary has two jobs, which have not yet been delivered to customers. Job MC-270 was completed on December 27, year 2. It is scheduled to ship on January 7, year 3. Job MC-275 is still in progress. For the purpose of computing the predetermined overhead rate, O’Leary uses the previous year’s actual overhead rate. Data on direct material costs and direct labor-hours for these jobs in year 2 follow.

Job MC-270

Job MC-275

Direct material costs

$

272,600

$

497,600

Direct labor-hours

2,630

hours

3,330

hours

During year 3, O’Leary incurred the following direct material costs and direct labor-hours for all jobs worked in year 3, including the completion of Job MC-275.

Direct material costs

$

11,842,600

Direct labor-hours

76,600

Actual manufacturing overhead

$

9,744,000

At the end of year 3, there were four jobs that had not yet shipped. Data on these jobs follow.

MC-389

MC-390

MC-397

MC-399

Direct materials

$45,800

$69,600

$106,100

$31,500

Direct labor-hours

1,766 hours

2,830 hours

6,230 hours

1,430 hours

Job status

Finished

Finished

In progress

In progress

Required:

What was the amount in the beginning Finished Goods and beginning Work-in-Process accounts for year 3?

O’Leary incurred direct materials costs of $59,600 and used an additional 560 hours in year 3 to complete job MC-275. What was the final (total) cost charged to job MC-275?

What was over- or underapplied overhead for year 3?

O’Leary prorates any over- or underapplied overhead to Cost of Goods Sold, Finished Goods Inventory, and Work-in-Process Inventory. Prepare the journal entry to prorate the over- or underapplied overhead.

A customer has asked O’Leary to bid on a job to be completed in year 4. O’Leary estimates that the job will require about $93,800 in direct materials and 5,130 direct labor-hours. Because of the economy, O’Leary expects demand for its services to be low in year 4, and the CEO wants to bid aggressively, but does not want to lose any money on the project. O’Leary estimates that there would be virtually no sales or administrative costs associated with this job. What is the minimum amount O’Leary can bid on the job and still not incur a loss?

Transcribed Image Text:O'Leary Corporation manufactures special purpose portable structures (huts, mobile offices, and so on) for use at construction sites. It only builds to order (each unit is built to customer specifications). O'Leary uses a normal job costing system. Direct labor at O'Leary is paid $30 per hour, but the employees are not paid if they are not working on jobs. Manufacturing overhead is assigned to jobs by a predetermined rate on the basis of direct labor-hours. The company incurred manufacturing overhead costs during two recent years (adjusted for price-level changes using current prices and wage rates) as follows. Year 1 Year 2 Direct labor-hours worked 69, 600 56, 600 Manufacturing overhead costs incurred Indirect labor Employee benefits Supplies Рower Heat and light Supervision Depreciation. Property taxes and insurance 2,864,000 1,044,000 696, 000 653, 000 2,264,000 849,000 566, 000 548,000 143,200 664, 050 2,060, 500 143,200 783,790 2,060,500 803,510 829,250 Total manufacturing overhead costs 9,048,000 7,924,000 At the beginning of year 3, O'Leary has two jobs, which have not yet been delivered to customers. Job MC-270 was completed on December 27, year 2. It is scheduled to ship on January 7, year 3. Job MC-275 is still in progress. For the.pupose.of computing the predetermined overhead rate, O'Leary uses the previous year's actual overhead rate. Data on direct material costs and direct labor-hours for these jobs in year 2 follow. Job MC-270 Job MC-275 497, 600 3,330 hours Direct material costs 272, 600 2,630 hours Direct labor-hours During year 3, O'Leary incurred the following direct material costs and direct labor-hours for all jobs worked in year 3, including the completion of Job MC-275. Direct material costs Direct labor-hours Actual manufacturing overhead 11,842, 600 76, 600 9,744,000 At the end of year 3, there were four jobs that had not yet shipped. Data on these jobs follow. мс-390 $69, 600 2,830 hours мс-399 $31,500 1,430 hours In progress MC-389 МC-397 Direct materials Direct labor-hours Job status $45,800 1,766 hours Finished $106,100 6,230 hours In progress Finished Required: a. What was the amount in the beginning Finished Goods and beginning Work-in-Process accounts for year 3? b. O'Leary incurred direct materials costs of $59,600 and used an additional 560 hours in year 3 to complete job MC-275. What was the final (total) cost charged to job MC-275? c. What was over- or underapplied overhead for year 3? d. O'Leary prorates any over- or underapplied overhead to Cost of Goods Sold, Finished Goods Inventory, and Work-in-Process Inventory. Prepare the journal entry to prorate the over- or underapplied overhead. e. A customer has asked O'Leary to bid on a job to be completed in year 4. O'Leary estimates that the job will require about $93,800 in direct materials and 5,130 direct labor-hours. Because of the economy, O'Leary expects demand for its services to be low in year 4, and the CEO wants to bid aggressively, but does not want to lose any money on the project. O'Leary estimates that there would be virtually no sales or administrative costs associated with this job. What is the minimum amount O'Leary can bid on the job and still not incur a loss? Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Required E What was the amount In the beginning Finished Goods and beginning Work-In-Process accounts for year 3? Work-in-process inventory Finished goods inventory < Required A Required B > Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Required E O'Leary incurred direct materials costs of $59,600 and used an additional 560 hours in year 3 to complete job MC-275. What was the final (total) cost charged to Job MC-275? Final (total) cost charged < Required A Required C > Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Required E What was over- or underapplied overhead for year 3? overhead < Required B Required D >
Transcribed Image Text:O'Leary prorates any over- or underapplied overhead to Cost of Goods Sold, Finished Goods Inventory, and Work-in-Process Inventory. Prepare the journal entry to prorate the Over- or Underapplied Overhead. (If no entry is required for a transaction/event, select "No journal entry required" in the first account fleld.) View transaction list Journal entry worksheet A > Record the entry to prorate any over- or underapplied overhead. Note: Enter debits before credits. Transaction General Journal Debit Credit 1 Record entry Clear entry View general journal Required A Required B Required C Required D Required E A customer has asked O'Leary to bid on a job to be completed in year 4. OʻLeary estimates that the job will require about $93,800 in direct materials and 5,130 direct labor-hours. Because of the economy, O'Leary expects demand for its services to be low in year 4, and the CEO wants to bid aggressively, but does not want to lose any money on the project. O'Leary estimates that there would be virtually no sales or administrative costs associated with this job. What is the minimum amount O'Leary can bid on the job and still not incur loss? Show less A Minimum amount < Required D Required E >

Question

Please I need help answering this problem

O’Leary Corporation manufactures special purpose portable structures (huts, mobile offices, and so on) for use at construction sites. It only builds to order (each unit is built to customer specifications). O’Leary uses a normal job costing system. Direct labor at O’Leary is paid $30 per hour, but the employees are not paid if they are not working on jobs. Manufacturing overhead is assigned to jobs by a predetermined rate on the basis of direct labor-hours. The company incurred manufacturing overhead costs during two recent years (adjusted for price-level changes using current prices and wage rates) as follows.

		Year 1		Year 2
Direct labor-hours worked		69,600		56,600
Manufacturing overhead costs incurred
Indirect labor	$	2,864,000	$	2,264,000
Employee benefits		1,044,000		849,000
Supplies		696,000		566,000
Power		653,000		548,000
Heat and light		143,200		143,200
Supervision		783,790		664,050
Depreciation		2,060,500		2,060,500
Property taxes and insurance		803,510		829,250
Total manufacturing overhead costs	$	9,048,000	$	7,924,000

At the beginning of year 3, O’Leary has two jobs, which have not yet been delivered to customers. Job MC-270 was completed on December 27, year 2. It is scheduled to ship on January 7, year 3. Job MC-275 is still in progress. For the purpose of computing the predetermined overhead rate, O’Leary uses the previous year’s actual overhead rate. Data on direct material costs and direct labor-hours for these jobs in year 2 follow.

	Job MC-270	Job MC-275
Direct material costs	$	272,600		$	497,600
Direct labor-hours		2,630	hours		3,330	hours

During year 3, O’Leary incurred the following direct material costs and direct labor-hours for all jobs worked in year 3, including the completion of Job MC-275.


Direct material costs	$	11,842,600
Direct labor-hours		76,600
Actual manufacturing overhead	$	9,744,000

At the end of year 3, there were four jobs that had not yet shipped. Data on these jobs follow.

	MC-389	MC-390	MC-397	MC-399
Direct materials	$45,800	$69,600	$106,100	$31,500
Direct labor-hours	1,766 hours	2,830 hours	6,230 hours	1,430 hours
Job status	Finished	Finished	In progress	In progress

Required:

What was the amount in the beginning Finished Goods and beginning Work-in-Process accounts for year 3?
O’Leary incurred direct materials costs of $59,600 and used an additional 560 hours in year 3 to complete job MC-275. What was the final (total) cost charged to job MC-275?
What was over- or underapplied overhead for year 3?
O’Leary prorates any over- or underapplied overhead to Cost of Goods Sold, Finished Goods Inventory, and Work-in-Process Inventory. Prepare the journal entry to prorate the over- or underapplied overhead.
A customer has asked O’Leary to bid on a job to be completed in year 4. O’Leary estimates that the job will require about $93,800 in direct materials and 5,130 direct labor-hours. Because of the economy, O’Leary expects demand for its services to be low in year 4, and the CEO wants to bid aggressively, but does not want to lose any money on the project. O’Leary estimates that there would be virtually no sales or administrative costs associated with this job. What is the minimum amount O’Leary can bid on the job and still not incur a loss?

O'Leary Corporation manufactures special purpose portable structures (huts, mobile offices, and so on) for use at construction sites. It only builds to order (each unit is built to customer specifications). O'Leary uses a normal job costing system. Direct labor at
O'Leary is paid $30 per hour, but the employees are not paid if they are not working on jobs. Manufacturing overhead is assigned to jobs by a predetermined rate on the basis of direct labor-hours. The company incurred manufacturing overhead costs during two
recent years (adjusted for price-level changes using current prices and wage rates) as follows.
Year 1
Year 2
Direct labor-hours worked
69, 600
56, 600
Manufacturing overhead costs incurred
Indirect labor
Employee benefits
Supplies
Рower
Heat and light
Supervision
Depreciation.
Property taxes and insurance
2,864,000
1,044,000
696, 000
653, 000
2,264,000
849,000
566, 000
548,000
143,200
664, 050
2,060, 500
143,200
783,790
2,060,500
803,510
829,250
Total manufacturing overhead costs
9,048,000
7,924,000
At the beginning of year 3, O'Leary has two jobs, which have not yet been delivered to customers. Job MC-270 was completed on December 27, year 2. It is scheduled to ship on January 7, year 3. Job MC-275 is still in progress. For the.pupose.of computing the
predetermined overhead rate, O'Leary uses the previous year's actual overhead rate. Data on direct material costs and direct labor-hours for these jobs in year 2 follow.
Job MC-270
Job MC-275
497, 600
3,330 hours
Direct material costs
272, 600
2,630 hours
Direct labor-hours
During year 3, O'Leary incurred the following direct material costs and direct labor-hours for all jobs worked in year 3, including the completion of Job MC-275.
Direct material costs
Direct labor-hours
Actual manufacturing overhead
11,842, 600
76, 600
9,744,000
At the end of year 3, there were four jobs that had not yet shipped. Data on these jobs follow.
мс-390
$69, 600
2,830 hours
мс-399
$31,500
1,430 hours
In progress
MC-389
МC-397
Direct materials
Direct labor-hours
Job status
$45,800
1,766 hours
Finished
$106,100
6,230 hours
In progress
Finished
Required:
a. What was the amount in the beginning Finished Goods and beginning Work-in-Process accounts for year 3?
b. O'Leary incurred direct materials costs of $59,600 and used an additional 560 hours in year 3 to complete job MC-275. What was the final (total) cost charged to job MC-275?
c. What was over- or underapplied overhead for year 3?
d. O'Leary prorates any over- or underapplied overhead to Cost of Goods Sold, Finished Goods Inventory, and Work-in-Process Inventory. Prepare the journal entry to prorate the over- or underapplied overhead.
e. A customer has asked O'Leary to bid on a job to be completed in year 4. O'Leary estimates that the job will require about $93,800 in direct materials and 5,130 direct labor-hours. Because of the economy, O'Leary expects demand for its services to be low in year
4, and the CEO wants to bid aggressively, but does not want to lose any money on the project. O'Leary estimates that there would be virtually no sales or administrative costs associated with this job. What is the minimum amount O'Leary can bid on the job and still
not incur a loss?
Complete this question by entering your answers in the tabs below.
Required A
Required B
Required C
Required D
Required E
What was the amount In the beginning Finished Goods and beginning Work-In-Process accounts for year 3?
Work-in-process inventory
Finished goods inventory
< Required A
Required B >
Complete this question by entering your answers in the tabs below.
Required A
Required B
Required C
Required D
Required E
O'Leary incurred direct materials costs of $59,600 and used an additional 560 hours in year 3 to complete job MC-275. What
was the final (total) cost charged to Job MC-275?
Final (total) cost charged
< Required A
Required C >
Complete this question by entering your answers in the tabs below.
Required A
Required B
Required C
Required D
Required E
What was over- or underapplied overhead for year 3?
overhead
< Required B
Required D >

O'Leary prorates any over- or underapplied overhead to Cost of Goods Sold, Finished Goods Inventory, and Work-in-Process Inventory.
Prepare the journal entry to prorate the Over- or Underapplied Overhead. (If no entry is required for a transaction/event, select "No
journal entry required" in the first account fleld.)
View transaction list
Journal entry worksheet
A
>
Record the entry to prorate any over- or underapplied overhead.
Note: Enter debits before credits.
Transaction
General Journal
Debit
Credit
1
Record entry
Clear entry
View general journal
Required A
Required B
Required C
Required D
Required E
A customer has asked O'Leary to bid on a job to be completed in year 4. OʻLeary estimates that the job will require about
$93,800 in direct materials and 5,130 direct labor-hours. Because of the economy, O'Leary expects demand for its services to
be low in year 4, and the CEO wants to bid aggressively, but does not want to lose any money on the project. O'Leary
estimates that there would be virtually no sales or administrative costs associated with this job. What is the minimum amount
O'Leary can bid on the job and still not incur
loss?
Show less A
Minimum amount
< Required D
Required E >

Accepted Answer

Finished goods refer to those products which have been made by transforming raw material or…