Testing Department Assembly Department Total Overhead $338,000 $630,000 $968,000 130,000 45,000 Direct labor hours 40,000 170,000 Machine hours 120,000 165,000 Assembly Department Testing Department $58,000 Total Overhead $87,850 15,150 $29,850 Direct labor hours 11,700 3,450 Machine hours 4,100 10,900 15,000

Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter5: Process Costing
Section: Chapter Questions
Problem 7MC: What is the cost of direct labor f the conversion costs are $330.000 and manufacturing overhead is...
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Calculating Departmental Overhead Rates and Applying Overhead to Production

At the beginning of the year, Glaser Company estimated the following.

Glaser uses departmental overhead rates. In the assembly department,
overhead is applied on the basis of direct labor hours. In the testing
department, overhead is applied on the basis of machine hours. Actual
data for the month of March are as follows

1. Calculate the predetermined overhead rates for the assembly
and testing departments.
2. Calculate the overhead applied to production in each
department for the month of March.
3. By how much has each department's overhead been
overapplied? Underapplied?

Testing
Department
Assembly
Department
Total
Overhead
$338,000
$630,000
$968,000
130,000
45,000
Direct labor hours
40,000
170,000
Machine hours
120,000
165,000
Transcribed Image Text:Testing Department Assembly Department Total Overhead $338,000 $630,000 $968,000 130,000 45,000 Direct labor hours 40,000 170,000 Machine hours 120,000 165,000
Assembly
Department
Testing
Department
$58,000
Total
Overhead
$87,850
15,150
$29,850
Direct labor hours
11,700
3,450
Machine hours
4,100
10,900
15,000
Transcribed Image Text:Assembly Department Testing Department $58,000 Total Overhead $87,850 15,150 $29,850 Direct labor hours 11,700 3,450 Machine hours 4,100 10,900 15,000
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