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Problem 2-24A Schedule of Cost of Goods Manufactured; Overhead Analysis [LO1, LO2, LO3, LO6, LO7]

The Pacific Manufacturing Company operates a job-order costing system and applies overhead cost to jobs on the basis of direct labor cost. Its predetermined overhead rate was based on a cost formula that estimated $124,600 of manufacturing overhead for an estimated allocation base of $89,000 direct labor dollars. The company has provided the following data:

Inventories	Beginning		Ending
Raw materials	$	23,000	$	17,000
Work in process	$	47,000	$	35,000
Finished goods	$	71,000	$	61,000

The following actual costs were incurred during the year:

Purchase of raw materials (all direct)	$	136,000
Direct labor cost	$	85,000
Actual manufacturing overhead costs:
Insurance, factory	$	7,500
Depreciation of equipment	$	17,000
Indirect labor	$	46,100
Property taxes	$	8,100
Maintenance	$	14,000
Rent, building	$	31,000

Required:
1-a.	Compute the predetermined overhead rate for the year.

Predetermined overhead rate

%

1-b.	Compute the amount of underapplied or overapplied overhead for the year. (Input the amount as a positive value.)

(Click to select)UnderappliedOverapplied overhead

$

2.	Prepare a schedule of cost of goods manufactured for the year. Assume all raw materials are used in production as direct materials. (Input all amounts as positive values.)

Pacific Manufacturing Company Schedule of Cost of Goods Manufactured
Direct materials:
(Click to select)Raw materials inventory, beginningRaw materials inventory, endingWork in process, endingManufacturing overhead applied to work in processWork in process, beginning	$
(Click to select)DeductAdd: (Click to select)Purchases of raw materialsCost of goods manufacturedWork in process, endingRaw materials inventory, endingWork in process, beginning
Total raw materials available
(Click to select)AddDeduct: (Click to select)Raw materials inventory, endingWork in process, beginningPurchases of raw materialsWork in process, endingRaw materials inventory, beginning
Raw materials used in production		$
(Click to select)Purchases of raw materialsRaw materials inventory, endingWork in process, beginningWork in process, endingDirect labor
(Click to select)Work in process, beginningPurchases of raw materialsManufacturing overhead applied to work in processWork in process, endingRaw materials inventory, ending
Total manufacturing cost
(Click to select)AddDeduct: (Click to select)Raw materials inventory endingRaw materials inventory, beginningWork in process, beginningWork in process, endingPurchases of raw materials
(Click to select)DeductAdd: (Click to select)Raw materials inventory, beginningWork in process, endingRaw materials inventory, endingPurchases of raw materialsWork in process, beginning
Cost of goods manufactured		$

3.	Compute the unadjusted cost of goods sold for the year. (Do not include any underapplied or overapplied overhead in your cost of goods sold figure.)

Unadjusted cost of goods sold

$

4.	Job 137 was started and completed during the year. What price would have been charged to the customer if the job required $3,700 in materials and $4,300 in direct labor cost, and the company priced its jobs at 50% above the jobs cost according to the accounting system?

Price to customer

$

5.	Direct labor made up $8,200 of the $35,000 ending Work in Process inventory balance. Supply the information missing below:

Direct materials	$
Direct labor	8,200
Manufacturing overhead
Work in process inventory	$ 35,000

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