Question

Kim-Brooks, Inc. makes costumes for movies and television shows. Brooks Kimberly, the company's owner, prepared the following estimates for the upcoming year:

Manufacturing overhead cost	$800,000
Direct labor hours	50,000
Direct labor cost	$250,000
Machine hours	40,000

Required

(a)  

Assume that Kim-Brooks applies manufacturing overhead on the basis of direct labor hours. During the year, 49,800 direct labor hours were worked. How much overhead was applied to work in process? If actual manufacturing overhead for the year was $792,000, was overhead under- or over-applied during the year? By how much?

(b)  

Assume that Kim-Brooks applies manufacturing overhead on the basis of direct labor cost. During the year, $245,000 in direct labor cost was incurred. How much overhead was applied to work in process during the year? If actual manufacturing overhead for the year was $792,000, was overhead under- or over-applied during the year? By how much?

(c)  

Assume that Kim-Brooks applies manufacturing overhead on the basis of machine hours. During the year, 40,200 machine hours were worked. How much overhead was applied to work in process during the year? If actual manufacturing overhead for the year was $792,000, was overhead under- or over-applied during the year? By how much?

D4-20.  

Answer 1