4-16 Accounting for Overhead On December 30, 192, the Mitchell Company has completed all jobs in process except for Job # 447; the job cost sheet through that date showed direct materials of $40,000 and direct labor of $30,000.

Total factory overhead incurred through Décember 30 was $900,000. The labor-cost recapitulation for the December 31 working day was: direct labor

$8,000, indirect labor $2,000. In addition, miscellaneous factory overhead incurred on December 31 was $3,000. Direct materials of $2,000 were added to Job # 447.

The company’s charges to Work in Process during 19_2 included direct labor for 19_2 of $720,000, excluding the December 31 working day described above. The factory overhead is applied to jobs at 120 percent of direct labor.

The balance in Finished-Goods Inventory, December 31, 19_2, was $112,000 and in Cost of Goods Sold was $2,000,000.

Compute the normal cost of ending inventory, Work in Process, December SIO. 2:

_ What is the under- or overapplied factory overhead for 19_2?