The Excel worksheet form that appears below is to be used to recreate part of the example relating to Turbo Crafters that appears earlier in the chapter. The workbook, and instructions on how to complete the file, can be found in Connect.

You should proceed to the requirements below only after completing your worksheet.
Required:
1. Check your worksheet by changing the estimated total amount of the allocation base in the Data area to 60,000 machine-hours, keeping all of the other data the same as in the original example. If your worksheet is operating properly, the predetermined overhead rate should now be $5.00 per machine-hour. If you do not get this answer, find the errors in your worksheet and correct them.
How much is the underapplied (overapplied)
manufacturing overhead? Did it change? Why or why not?
2. Determine the underapplied (overapplied) manufacturing overhead for a different company with the following data:

Allocation base Estimated manufacturing overhead cost Estimated total amount of the allocation base Actual manufacturing overhead cost Actual total amount of the allocation base LO3–1, LO3–2, LO3–3, LO3–4 Raw materials Work in process . . . . . . . . . . Machine-hours $100,000 50,000 machine-hours $90,000 40,000 machine-hours 3. What happens to the underapplied (overapplied)
manufacturing overhead from part (2) if the estimated total amount of the allocation base is changed to 40,000 machinehours and everything else remains the same? Why is the amount of underapplied (overapplied) manufacturing overhead different from part (2)?
4. Change the estimated total amount of the allocation base back to 50,000 machine-hours so that the data look exactly like they did in part (2). Now change the actual manufacturing overhead cost to $100,000. What is the underapplied (overapplied) manufacturing overhead now?
Why is the amount of underapplied (overapplied)
manufacturing overhead different from part (2)?

Transcribed Image Text:

c 1 Chapter 3: Applying Excel 2 3 Data 4 Allocation base 5 Estimated manufacturing overhead cost 6 Estimated total amount of the allocation base 7 Actual manufacturing overhead cost 8 Actual total amount of the allocation base 9 10 Enter a formula into each of the cells marked with a ? below 11 12 Computation of the predetermined overhead rate 13 Estimated manufacturing overhead cost 14 Estimated total amount of the allocation base 15 Predetermined overhead rate 16 17 Computation of underapplied or overapplied manufacturing overhead 18 Actual manufacturing overhead cost 19 Manufacturing overhead cost applied to Work in Process during the year Predetermined overhead rate 20 21 Actual total amount of the allocation base 22 Manufacturing overhead applied Machine-hours $300.000 75,000 machine-hours $290,000 68,000 machine-hours ? machine-hours ? per machine-hour ? per machine-hour 7 machine-hours 23 Underapplied (overapplied) manufacturing overhead 24 Chapter 3 Form Filled in Chapter 3 Form Chapter 3 Formula