done by omar gamal tawfik 291800293

1-prdetermined rate =total estimated manufactoring overhead/direct labor cost

predetermined=106250/85000 1.25
rate =1.25+0.75 =2$/hour
2-The amount of overhead cost applied to Work in Process for the year would be: 80,000
hours× $2.00 per hour =160,000$
MOH

Utilities 14,000 160,000 DM 53

DL 85
Insurance 9,000 MOH
Maintenance 33,000
Indirect materials 7,000
Indirect labour 65,000
Depreciation 40,000

there will under applied by 8000 so

MOH

(Utilities) 14,000 160,000 DL 85

Insurance 9,000
Maintenance 33,000 DM 53
IDM 7,000
IDL 65,000 MOH 1
Depreciation 40,000

COGS( 8000)
MOH (8000)

When overhead is applied using a predetermined rate based on machinehours,

it is assumed that overhead cost is proportional to machinehours.
When the actual level of activity turns out to be 80,000 machinehours,
the costing system assumes that the overhead will be 80,000
machine hours
× $2.00 per machinehour,
or $160,000. This is a drop
of $10,000 from the initial estimated total manufacturing overhead
cost of $170,000.
 WIP

DM 530,000
DL 85,000
MOH 160,000

WIp

DL 85000

DM 530000

MOH 160000

on machinehours,
chinehours.
machinehours,
be 80,000

ng overhead
 done by omar gamal tawfik 291800293

Schedule of Cost of goods Manufactured

Direct Materials
Raw Material Inventory beginning $         8,200
Add: Purchases of raw Material $   134,000
Total Raw Material available $   142,200
Less: Raw Material Inventory ending $       10,100
Raw Material used in production $   131,400
Direct Labor $       89,000
Manufacturing overhead $   226,000
Total manufacturing cost $   446,400
Add: Beginning work in process inventory $         5,500
$ 451,900
Less: Ending work in process inventory $       20,200
Cost of goods manufactured $    431,700

Schedule of Cost of Goods Sold

Add: Finished Goods Inventory Beginning $       77,000
Cost of goods manufactured $   431,700
Less: Cost of goods available for sale $   508,700
Finished Goods Inventory Ending $       25,600
Add: Unadjusted cost of goods sold $   483,100
Underapplied Overheads $       23,000
Adjusted cost of goods sold $   506,100

Workings:
Underapplied Overheads = Actual Manufacturing overheads - Manufacturing overheads
applied

2 Underapplied Overheads = $226000 - $203000 = $23000

Income Statement
Sales $   655,000
Cost of Goods Sold $   506,100
Gross Margin $   148,900
Less: Selling and Administrative Expenses:
Selling Expense $   103,000
Less: Administrative Expense $   42,000 145,000
Net Operating Income $       3900
 done by omar gamal tawfik 291800293
number transaction debit credit
1- Raw material 325,000
a/p 325,000

2- MOH 58,000
Wip 232,000
raw material 290,000

3- wip 60,000
moh 120,000
salaries and wages payable 180,000

4- moh 75,000
acc depreciation 75,000

5- moh 62,000
a/p 62,000

6- wip 300,000
moh 300,000

work in pr
Manufactoring overhead
232,000
58,000 300,000 60,000
120,000 300,000
75,000
62,200 balance 592,000

balance 15,000

actual MOH applied

IDM 58,000 wps (15000 x (4800000/240000)) = 300,000

IDL 120,000
acc dep 75,000
MOH 62000
balance 15,000

Under applied Manufacturing overhead

The cost of the completed job would be $592,000 as shown in the Work in Process T-account above. The entry wo
 
 balance 15,000

Under applied Manufacturing overhead

The cost of the completed job would be $592,000 as shown in the Work in Process T-account above. The entry wo
 

Finished Goods Work in Process

592,000 592,000

 
 
4 .Product cost/ unit =$ 592,000/16000 = $37
 work in process

32,000
0,000
0,000

92,000

000)) = 300,000

ount above. The entry would be:

ount above. The entry would be: