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Bandway Company manufactures brass musical instruments for use by high school students. The company uses a normal costing system, in which manufacturing overhead is applied

Bandway Company manufactures brass musical instruments for use by high school students. The company uses a normal costing system, in which manufacturing overhead is applied on the basis of direct-labor hours. The company's budget for the current year included the following predictions. Budgeted total manufacturing overhead $462,000 Budgeted total direct-labor hours 21,000 During October, the firm worked on the following two production jobs: Job number T79, consisting of 76 trombones Job number C41, consisting of 110 cornets The events of October are described as follows: A. one thousand square feet of rooled brass sheet metal was purchased on account for $6,000 B. Four hundred pounds of brass tubing was purchased on account for $5,200 C. The following requisitions were submitted on October 5: Req. number 112: 260 square ft. of brass sheet metal at $5.50 per square ft (job T79) Req. number 113: 1,100 pounds of brass tubing, at $9.00 per pound (job C41) Req. number 114: 10 gallons of valve lubricant at $12 per gallon All brass used in production is treated as DM. Valve lubricant is an indirect material D. An analysis of labor time cards revealed the following labor usage for October. Direct labor: Job T79, 850 hours at $20 per hour Direct labor: Job C41, 950 hours at $20 per hour Indirect labor: General factory cleanup, $4,500 Indirect labor: Factory supervisory salaries, $9,600 E. Depreciation of the factory, building and equipment during October amounted to $13,000 F. Rent paid in cash for warehouse space used during October was $1,340 G. Utility costs incurred during October amounted to $2,400. The invoices for these costs were received, but the bills were not paid in October H. October property taxes on teh factory were paid in cash, $2,370 I. The insurance cost covering factory operations for the month of October was $2,900. The insurance policy has been prepaid J. The costs of salaries and fringe benefits for sales and administrative personnel paid in cash during October amounted to $7,500 K. Depreciation on administrative office equipment and space amounted to $4,500 L. Other selling and administrative expenses paid in cash during October amounted to $1,150 M. Job number T79 was completed on October 20 N. Half of the trombones in Job T79 were sold on account during October for $720 each The October 1 balances in selected accounts are as follows: Cash $11,000 Accounts receivable 20,000 Prepaid insurance 6,000 Raw-material inventory 150,000 Manufacturing supplies inventory 600 WIP inventory 89,000 Finished goods inventory 223,000 Accumulated depreciation: B & E 99,000 Accounts payable 14,500 Wages payable 8,500 Required: 1. Calculate the company's predetermined overhead rate for the year 2. Calculate over/under applied for October 3. Prepare COGManufactured for October 4. Prepare COGSold for October 5. Prepare income statement of October

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