3 Exercise 2 10 Applying Overhead Cost to a Job LO2 2 Sigma Corporation applies overhead cost to jobs on the basis of direct labor cost Job V, which was started and completed during the current period, shows charges of $5,300 for direct materials, $9,300 for direct labor, and $5,766 for overhead on its job cost sheet Job W, which is still in process at year end, shows charges of $2,800 for direct materials and $5,600 for direct labor Required 1a Should any overhead cost be applied to Job W at year end multiple choice 1 Yes No 1b How much overhead cost should be applied to Job W 2 How will the costs included in Job Ws job cost sheet be reported within Sigma Corporations financial statements at the end of the year multiple choice 2 Raw Materials Work in Process Finished Goods 4 Exercise 3 3 Schedules of Cost of Goods Manufactured and Cost of Goods Sold LO3 3 Primare Corporation has provided the following data concerning last months manufacturing operations Purchases of raw materials $ 31,000 Indirect materials included in manufacturing overhead $ 4,710 Direct labor $ 58,300 Manufacturing overhead applied to work in process $ 88,900 Underapplied overhead $ 4,050 Inventories Beginning Ending Raw materials $ 11,300 $ 19,600 Work in process $ 54,300 $ 69,900 Finished goods $ 33,800 $ 43,900 Required 1 Prepare a schedule of cost of goods manufactured for the month 2 Prepare a schedule of cost of goods sold for the month Assume the underapplied or overapplied overhead is closed to Cost of Goods Sold 5 Exercise 3 4 Underapplied and Overapplied Overhead LO3 4 Osborn Manufacturing uses a predetermined overhead rate of $19 10 per direct labor hour This predetermined rate was based on a cost formula that estimates $246,390 of total manufacturing overhead for an estimated activity level of 12,900 direct labor hours The company actually incurred $245,000 of manufacturing overhead and 12,400 direct labor hours during the period Required 1 Determine the amount of underapplied or overapplied manufacturing overhead for the period 2 Assume that the company's underapplied or overapplied overhead is closed to Cost of Goods Sold Would the journal entry to dispose of the underapplied or overapplied 6 Required information Exercise 5 5 Changes in Variable Costs, Fixed Costs, Selling Price, and Volume LO5 4 Skip to question The following information applies to the questions displayed below Data for Hermann Corporation are shown below Per Unit Percent of Sales Selling price $ 110 100 Variable expenses 77 70 Contribution margin $ 33 30 Fixed expenses are $82,000 per month and the company is selling 3,500 units per month Garrison 16e Rechecks 2017 05 02 rev 06 04 2020 QC CS 205709, 06 18 2020 QC CS 216765, 07 14 2020 QC CS 216765 Exercise 5 5 Part 2 2 a Refer to the original data How much will net operating income increase (decrease) per month if the company uses higher quality components that increase the variable expense by $5 per unit and increase unit sales by 20 2 b Should the higher quality components be used

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3. Exercise 2-10 Applying Overhead Cost to a Job [LO2-2] Sigma Corporation applies overhead cost to jobs on the basis of direct labor cost. Job

Exercise 2-10 Applying Overhead Cost to a Job [LO2-2]

Sigma Corporation applies overhead cost to jobs on the basis of direct labor cost. Job V, which was started and completed during the current period, shows charges of $5,300 for direct materials, $9,300 for direct labor, and $5,766 for overhead on its job cost sheet. Job W, which is still in process at year-end, shows charges of $2,800 for direct materials and $5,600 for direct labor.

Required:

1a. Should any overhead cost be applied to Job W at year-end?

multiple choice 1

1b. How much overhead cost should be applied to Job W?

2. How will the costs included in Job Ws job cost sheet be reported within Sigma Corporations financial statements at the end of the year?

multiple choice 2

Raw Materials
Work-in-Process
Finished Goods

Exercise 3-3 Schedules of Cost of Goods Manufactured and Cost of Goods Sold [LO3-3]

Primare Corporation has provided the following data concerning last months manufacturing operations.


Purchases of raw materials	$	31,000
Indirect materials included in manufacturing overhead	$	4,710
Direct labor	$	58,300
Manufacturing overhead applied to work in process	$	88,900
Underapplied overhead	$	4,050

Inventories	Beginning		Ending
Raw materials	$	11,300	$	19,600
Work in process	$	54,300	$	69,900
Finished goods	$	33,800	$	43,900

Required:

1. Prepare a schedule of cost of goods manufactured for the month.

2. Prepare a schedule of cost of goods sold for the month. Assume the underapplied or overapplied overhead is closed to Cost of Goods Sold.

Exercise 3-4 Underapplied and Overapplied Overhead [LO3-4]

Osborn Manufacturing uses a predetermined overhead rate of $19.10 per direct labor-hour. This predetermined rate was based on a cost formula that estimates $246,390 of total manufacturing overhead for an estimated activity level of 12,900 direct labor-hours.

The company actually incurred $245,000 of manufacturing overhead and 12,400 direct labor-hours during the period.

Required:

1. Determine the amount of underapplied or overapplied manufacturing overhead for the period.

2. Assume that the company's underapplied or overapplied overhead is closed to Cost of Goods Sold. Would the journal entry to dispose of the underapplied or overapplied

Required information

Exercise 5-5 Changes in Variable Costs, Fixed Costs, Selling Price, and Volume [LO5-4]

Skip to question

[The following information applies to the questions displayed below.]

Data for Hermann Corporation are shown below:

	Per Unit		Percent of Sales
Selling price	$	110		100	%
Variable expenses		77		70
Contribution margin	$	33		30	%

Fixed expenses are $82,000 per month and the company is selling 3,500 units per month.

Garrison 16e Rechecks 2017-05-02

rev: 06_04_2020_QC_CS-205709, 06_18_2020_QC_CS-216765, 07_14_2020_QC_CS-216765

Exercise 5-5 Part 2

2-a. Refer to the original data. How much will net operating income increase (decrease) per month if the company uses higher-quality components that increase the variable expense by $5 per unit and increase unit sales by 20%.

2-b. Should the higher-quality components be used?