1)

Tyler Tooling Company uses a job order cost system with overhead applied to products on the basis of machine hours. For the upcoming year, the company estimated its total manufacturing overhead cost at $420,000 and total machine hours at 60,000. During the first month of operations, the company worked on three jobs and recorded the following actual direct materials cost, direct labor cost, and machine hours for each job:

	Job 101			Job 102			Job 103			Total
Direct materials used	$	19,200		$	14,400		$	9,600		$	43,200
Direct labor	$	28,800		$	11,200		$	9,600		$	49,600
Machine hours		1,000	hours		4,000	hours		2,000	hours		7,000	hours

Job 101 was completed and sold for $60,000. Job 102 was completed but not sold. Job 103 is still in process. Actual overhead costs recorded during the first month of operations totaled $45,000. Required: 1. Calculate the predetermined overhead rate.

2. Compute the total manufacturing overhead applied to the Work in Process Inventory account during the first month of operations.

3. Compute the balance in the Work in Process Inventory account at the end of the first month.

4. How much gross profit would the company report during the first month of operations before making an adjustment for over- or underapplied manufacturing overhead?

5-a. Determine the balance in the Manufacturing Overhead account at the end of the first month.

5-b. Is it over- or underapplied?

2) StorSmart Company makes plastic organizing bins. The company has the following inventory balances at the beginning and end of March:

	Beginning Inventory			Ending Inventory
Raw materials	$	33,000		$	22,000
Work in process		25,000			44,000
Finished goods		60,000			58,000

Additional information for the month of March follows:

Raw materials purchases	$	84,000
Indirect materials used		10,000
Direct labor		55,000
Manufacturing overhead applied		85,000
Selling, general, and administrative expenses		58,000
Sales revenue		450,000

Required:

1. Based on the above information, prepare a cost of goods manufactured report.

2. Based on the above information, prepare an income statement for the month of March.

eBook Required: 1. Calculate the predetermined overhead rate. 2. Compute the total manufacturing overhead applied to the Work in Process Inventory account during the first month of operations. 3. Compute the balance in the Work in Process Inventory account at the end of the first month. 4. How much gross profit would the company report during the first month of operations before making an adjustment for over- or underapplied manufacturing overhead? 5-a. Determine the balance in the Manufacturing Overhead account at the end of the first month. 5-b. Is it over- or underapplied? Print References 1. Predetermined Overhead Rate per machine hour 2. 3. Total Applied Manufacturing Overhead Ending Work in Process Inventory Gross profit 4. 5-a. Balance 5-b. Is it over- or underapplied? 1.5 points Required 1 Required 2 Based on the above information, prepare an income statement for the month of March. eBook STORSMART COMPANY Income Statement For the Month of March Print Sales Revenue $ 450,000 Less: Cost of Goods Sold References Direct Labor Plus: Cost of Goods Manufactured 60,000 58,000 Less: Ending Finished Goods Inventory Cost of Goods Sold 208,000 242,000 Gross Profit Selling, General, and Administrative Expenses 58,000 Net Income (Loss) from Operations $ 184,000