value 1000 points Moody Corporation uses a joborder costing

value: 10.00 points Moody Corporation uses a job-order costing system with a plantwide overhead rate based on machine- hours. At the beginning of the year, the company made the following estimates: Machine-hours required to support estimated production159,000 Fixed manufacturing overhead cost Variable manufacturing overhead cost per machine-hour $4.20 $654,000 Required 1. Compute the predetermined overhead rate. (Do not round intermediate calculations. Round your answer to 2 decimal places.) Predetermined overhead ate ·31 :13:21, kill 2. During the year, Job 400 was started and completed. The following information was available with respect to this job: Direct materials requisitioned$350 Direct labor cost Machine-hours used $200 36

Solution

1) Predetermined overhead rate Formula: Estimated manufacturing overhead/estimated machine hours Variable manufacturing overhead cost per machine hour 4.20 Fixed manufacturing overhead cost per mh (654,000/159,000)= 4.11 predetermined overhead rate 8.31 per MH 2) Total manufacturing cost $ Direct materials requistioned 350 Direct labor cost 200 Overhead applied [$8.31*36] 299.16 Total manufacturing cost 849.16 3-a) Actual manufacturing overhead cost 1,214,767 Applied overhead (145,700*8.31)        1,210,767 manufacturing overhead cost underapplied by                4,000 3b) Decrease (since cost of goods sold will increase once overhead underapplied is adjusted)