Renteria Company applies manufacturing overhead to jobs on the basis of machine hours used

ACC 560 Week 2 Assignment

E2-5 Renteria Company applies manufacturing overhead to jobs on the basis of machine hours used. Overhead costs are expected to total $305,000 for the year, and machine usage is estimated at 125,000 hours. For the year, $322,000 of overhead costs are incurred and 130,000 hours are used.

1. Compute the manufacturing overhead rate for the year.
2. What is the amount of under- or overapplied overhead at December 31?
3. Prepare the adjusting entry to assign the under- or overapplied overhead for the year to cost of goods sold.

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Cleveland Metals uses a job cost system and applies factory overhead to production at a predetermined rate of 180% of direct labor cost

Cost flows and overhead application

Cleveland Metals uses a job cost system and applies factory overhead to production at a predetermined rate of 180% of direct labor cost. Data pertaining to recent operations follow.

• Job no. 636 was the only job in process on January 1 of the current year. The Work in Process account contained a $24,600 balance on this date.
• Jobs no. 637, 638, and 639 were started during January.
• Total direct material requisitions and direct labor incurred during January amounted to $89,200 and $114,500, respectively.
• The only job that remained in process on January 31 was job no. 638, with costs of $15,000 for direct materials and $20,000 for direct labor.

a. Compute the total cost of the work in process inventory on January 31.
b. Compute the cost of jobs completed during January, and present the proper journal entry to reflect job completion.

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(Overhead application: Working backward) The Towson Manufacturing Corporation applies overhead on the basis of machine hours

Overhead application: Working backward

The Towson Manufacturing Corporation applies overhead on the basis of machine hours. The following divisional information is presented for your review:

Division A Division B
Actual machine hours 22,500 ?
Estimated machine hours 20,000 ?
Overhead application rate $4.50 $5.00
Actual overhead $110,000 ?
Estimated overhead ? $90,000
Applied overhead ? $86,000
Over- (under-) applied overhead ? $6,500

Find the unknowns for each of the divisions.

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