Verizox Company uses a job order cost system with manufacturing overhead applied to products based on...

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Accounting

Verizox Company uses a job order cost system with manufacturingoverhead applied to products based on direct labor hours. At thebeginning of the most recent year, the company estimated itsmanufacturing overhead cost at $172,980. Estimated direct laborcost was $435,240 for 18,600 hours.
Actual costs for the most recent month are summarizedhere:
Item Description Total Cost
Direct labor (1,860 hours) $ 43,525
Indirect costs
Indirect labor 2,430
Indirect materials 3,380
Factory rent 3,240
Factory supervision 4,810
Factory depreciation 5,640
Factory janitorial work 1,150
Factory insurance 1,830
General and administrativesalaries 4,250
Selling expenses 5,380

Required:
1. Calculate the predetermined overhead rate.(Round your answer to 2 decimal places.)

2. Calculate the amount of applied manufacturingoverhead.

3. Calculate actual manufacturing overheadcosts.

4. Compute over- or underapplied overhead.(Input the amount as positive value.)

Answer & Explanation Solved by verified expert

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1 Computation of predetermined overhead rate predetermined overhead rate Estimated Manufacturing OH Estimated Hours predetermined overhead rate 172980 18600 Predetermined overhead rate 930 pere See Answer

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Transcribed Image Text

Verizox Company uses a job order cost system with manufacturingoverhead applied to products based on direct labor hours. At thebeginning of the most recent year, the company estimated itsmanufacturing overhead cost at $172,980. Estimated direct laborcost was $435,240 for 18,600 hours.Actual costs for the most recent month are summarizedhere: Item DescriptionTotal CostDirect labor (1,860 hours)$43,525Indirect costsIndirect labor2,430Indirect materials3,380Factory rent3,240Factory supervision4,810Factory depreciation5,640Factory janitorial work1,150Factory insurance1,830General and administrativesalaries4,250Selling expenses5,380Required:1. Calculate the predetermined overhead rate.(Round your answer to 2 decimal places.)2. Calculate the amount of applied manufacturingoverhead.3. Calculate actual manufacturing overheadcosts.4. Compute over- or underapplied overhead.(Input the amount as positive value.)

Item Description	Total Cost
Direct labor (1,860 hours)	$	43,525
Indirect costs
Indirect labor		2,430
Indirect materials		3,380
Factory rent		3,240
Factory supervision		4,810
Factory depreciation		5,640
Factory janitorial work		1,150
Factory insurance		1,830
General and administrativesalaries		4,250
Selling expenses		5,380