Please answer number 3 ABC Thank you 3 Molin Corporation is

3) Molin Corporation is a manufacturer that uses job-order costing. The company closes out any overapplied or underapplied overhead to Cost of Goods Sold at the end of the year. The company has supplied the following data for the just completed year: Estimated total manufacturing overhead at the beginning of the year Estimated direct labor-hours at the beginning of the year S638,750 35,000 direct labor-hours Results of operations: 40,000 direct labor-hours Actual direct labor-hours Manufacturing overhead: Indirect labor cost Other manufacturing overhead costs incurred $166,000 $595,000 $1,570,000 Cost of goods sold (unadjusted) Required a. What is the total amount of manufacturing overhead applied to production during the year? b. Is manufacturing overhead overapplied or underapplied for the year? By how much? c. What is the adjusted cost of goods sold for the year?

Solution

Estimated Total Manufacturing overhead at the beginning of the year (A)                         638,750 Estimated direct Labour hours at the beginning of the year (B)                           35,000 Predetemined Over head Rate (C =A/B)                             18.25 Actual Direct Labour Hours (D)                           40,000 a Total Manufacturing Overhead applied (C*D)                         730,000 Actual Manufacturing Overhead                         761,000 (166000 + 595000) (\'E) b Manufacturing Overhead is underapplied by (F = E-D)                           31,000 Cost of Goods sold (unadjusted) (G)                     1,570,000 c Cost of Goods sold (adjusted) (F+G)                     1,601,000