Question
Antoine Machining estimated its manufacturing overhead to be $279,000 and its direct materials costs to be $450,000 in Year 1. Three of the jobs that
Antoine Machining estimated its manufacturing overhead to be $279,000 and its direct materials costs to be $450,000 in Year 1. Three of the jobs that Antoine Machining worked on in Year 1 had actual direct materials costs of $15,000 for Job AM002, $55,000 for Job AM005, and $70,000 for Job AM008. For Year 1, actual manufacturing overhead was $313,000 and total direct materials cost was $540,000. Manufacturing overhead is applied to jobs on the basis of direct materials costs using predetermined rates.
Required:
a. How much overhead was assigned to each of the three jobs, AM002, AM005, and AM008?
b. What was the over- or underapplied manufacturing overhead for Year 1?
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