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In: Accounting
In December 2016, Learer Company’s manager estimated next year’s total direct labor cost assuming 25 persons...
In December 2016, Learer Company’s manager estimated next year’s total direct labor cost assuming 25 persons working an average of 2,000 hours each at an average wage rate of $40 per hour. The manager also estimated the following manufacturing overhead costs for 2017. Indirect labor $ 322,200 Factory supervision 219,000 Rent on factory building 143,000 Factory utilities 91,000 Factory insurance expired 71,000 Depreciation—Factory equipment 380,000 Repairs expense—Factory equipment 63,000 Factory supplies used 71,800 Miscellaneous production costs 39,000 Total estimated overhead costs $ 1,400,000 At the end of 2017, records show the company incurred $1,810,000 of actual overhead costs. It completed and sold five jobs with the following direct labor costs: Job 201, $607,000; Job 202, $566,000; Job 203, $301,000; Job 204, $719,000; and Job 205, $317,000. In addition, Job 206 is in process at the end of 2017 and had been charged $20,000 for direct labor. No jobs were in process at the end of 2016. The company’s predetermined overhead rate is based on direct labor cost. Required 1-a. Determine the predetermined overhead rate for 2017. 1-b. Determine the total overhead cost applied to each of the six jobs during 2017. 1-c. Determine the over- or underapplied overhead at year-end 2017. 2. Assuming that any over- or underapplied overhead is not material, prepare the adjusting entry to allocate any over- or underapplied overhead to Cost of Goods Sold at the end of 2017. *Please show all parts.
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ekkarill92 answered 2 years agoRelated Solutions
In December 2016, Learer Company’s manager estimated next year’s total direct labor cost assuming 30 persons...
In December 2016, Learer Company’s manager estimated next year’s
total direct labor cost assuming 30 persons working an average of
2,000 hours each at an average wage rate of $30 per hour. The
manager also estimated the following manufacturing overhead costs
for 2017.
Indirect
labor
$228,200
Factory
supervision
136,000
Rent on factory
building
149,000
Factory
utilities
97,000
Factory
insurance expired
77,000
Depreciation—Factory equipment
201,000
Repairs
expense—Factory equipment
69,000
Factory supplies
used
77,800
Miscellaneous
production costs
45,000
Total estimated
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In December 2016, Learer Company’s manager estimated next year’s total direct labor cost assuming 35 persons...
In December 2016, Learer Company’s manager estimated next year’s
total direct labor cost assuming 35 persons working an average of
3,000 hours each at an average wage rate of $20 per hour. The
manager also estimated the following manufacturing overhead costs
for 2017.
Indirect labor
$335,200
Factory supervision
165,000
Rent on factory building
156,000
Factory utilities
104,000
Factory insurance expired
84,000
Depreciation—Factory
equipment
413,000
Repairs expense—Factory
equipment
76,000
Factory supplies used
84,800
Miscellaneous production
costs
52,000
Total estimated overhead
costs...
In December 2016, Learer Company’s manager estimated next year’s total direct labor cost assuming 45 persons...
In December 2016,
Learer Company’s manager estimated next year’s total direct labor
cost assuming 45 persons working an average of 2,000 hours each at
an average wage rate of $25 per hour. The manager also estimated
the following manufacturing overhead costs for 2017.
Indirect
labor
$
325,200
Factory
supervision
233,000
Rent on factory
building
146,000
Factory
utilities
94,000
Factory
insurance expired
74,000
Depreciation—Factory equipment
520,000
Repairs
expense—Factory equipment
66,000
Factory supplies
used
74,800
Miscellaneous
production costs
42,000
Total estimated
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In December 2010, Gomez Company’s manager estimated next year’s total direct labor cost assuming 50 persons...
In December 2010, Gomez Company’s manager estimated next year’s
total direct labor cost assuming 50 persons working an average of
2,020 hours each at an average wage rate of $15 per hour. The
manager also estimated the following manufacturing overhead costs
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Indirect labor
$
167,650
Factory
supervision
123,000
Rent on factory
building
76,000
Factory
utilities
46,000
Factory insurance
expired
35,100
Depreciation—Factory
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249,000
Repairs
expense—Factory equipment
31,500
Factory supplies
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Miscellaneous
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At the beginning of the year, Learer Company’s manager estimated total direct labor cost assuming 45...
At the beginning of the year, Learer Company’s manager estimated
total direct labor cost assuming 45 persons working an average of
2,500 hours each at an average wage rate of $20 per hour. The
manager also estimated the following manufacturing overhead costs
for the year.
Indirect labor
$
330,200
Factory supervision
109,000
Rent on factory building
151,000
Factory utilities
99,000
Factory insurance expired
79,000
Depreciation—Factory equipment
384,000
Repairs expense—Factory equipment
71,000
Factory supplies used
79,800
Miscellaneous production costs
47,000
Total...
At the beginning of the year, Learer Company’s manager estimated total direct labor cost assuming 45...
At the beginning of the year, Learer Company’s manager estimated
total direct labor cost assuming 45 persons working an average of
2,000 hours each at an average wage rate of $25 per hour. The
manager also estimated the following manufacturing overhead costs
for the year.
Indirect labor
$
325,200
Factory supervision
233,000
Rent on factory building
146,000
Factory utilities
94,000
Factory insurance expired
74,000
Depreciation—Factory equipment
520,000
Repairs expense—Factory equipment
66,000
Factory supplies used
74,800
Miscellaneous production costs
42,000
Total...
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