T-Mobile LTE 4:56 PM ezto.mheducation.com * 45% 5. 20 ent E2-16 Calculating Actu

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T-Mobile LTE 4:56 PM ezto.mheducation.com * 45% 5. 20 ent E2-16 Calculating Actual and Applied Manufacturing Overhead Costs and Over- or Underapplied Overhead Costs [LO 2-3, 2-4, 2-5, 2-6 Verizox Company uses a job order cost system with manufacturing overhead applied to products based on direct labor hours. At the beginning of the most recent year, the company estimated its manufacturing overhead cost at $176,640 Estimated direct labor cost was $464,640 for 19,200 hours. Actual costs for the most recent month are summarized here: Required: 1. Calculate the predetermined overhead rate. (Round your answer to 2 decimal places.) 2. Calculate the amount of applied manufacturing overhead. 3. Calculate actual manufacturing overhead costs. 4. Compute over- or underapplied overhead. (Input the amount as positive value.)

Explanation / Answer

1 Predetermined overhead rate = 176640/19200= $9.2 per DL hour 2 Applied manufacturing overhead = 1920*9.2= $17664 3 Indirect Labor 2440 Indirect Material 3380 Factory Rent 3300 Factory Supervision 4710 Factory Depreciation 5710 Factory Janitorial Work 1270 Factory Insurance 1710 Actual Manufacturing Overhead Costs 22520 4 Overhead underapplied = 22520-17664 = $4856

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