Change all of the numbers in the data area of your worksheet so that it looks like this: A 1 Chapter 3: Applying Excel 2 3 Data 4 Allocation base 5 Estimated manufacturing overhead cost 6 Estimated total amount of the allocation base 7 Actual manufacturing overhead cost 8 Actual total amount of the allocation base Predetermined overhead rate B Machine-hours $ 329,400 $ C 61,000 machine-hours 344,500 65,000 machine-hours If your formulas are correct, you should get the correct answers to the following questions. (a) What is the Predetermined overhead rate? (Round your answer to 2 decimal places.) per machine-hour (b) By how much is the manufacturing overhead underapplied or overapplied? manufacturing overhead 3. Either print or make a copy of your worksheet in your workbook before proceeding. You will need to refer back to this worksheet. Change the estimated total amount of the allocation base to 54,000 machine-hours, but keep everything the same as in Requirement 2. The data area of your worksheet should now look like this: A 1 Chapter 3: Applying Excel 2 3 Data 4 Allocation base 5 6 7 Actual manufacturing overhead cost 8 Actual total amount of the allocation base Estimated manufacturing overhead cost Estimated total amount of the allocation base manufacturing overhead Machine-hours $ B $ 329,400 54,000 machine-hours 344,500 65,000 machine-hours (a) By how much is the manufacturing overhead underapplied or overapplied? (b) Why is the amount of underapplied (overapplied) manufacturing overhead different from Requirement 2 above? (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answers and double click the box with the question mark to empty the box for a wrong answers. Any boxes left with a question mark will be automatically graded as incorrect.) ?The change in the estimated total amount of the allocation base affected the predetermined overhead rate. ? The change in the estimated total amount of the allocation base affected the amount of manufacturing overhead applied. ? Actual manufacturing overhead cost differs from period to period. ? The estimated manufacturing overhead cost did not change in proportion to the change in the estimated total amount of the allocation base. 4. Change the estimated total amount of the allocation base back to 61,000 machine-hours, so that the data area of you worksheet looks exactly the same as in Requirement 2. Now change the actual manufacturing overhead cost from $344,500 to $338,600. The data area of your worksheet should now look like this: 5 6 7 8 A 1 Chapter 3: Applying Excel 2 3 4 Data Allocation base Estimated manufacturing overhead cost Estimated total amount of the allocation base Actual manufacturing overhead cost Actual total amount of the allocation base B Machine-hours $ C 329,400 61,000 machine-hours 338,600 65,000 machine-hours (a) By how much is the manufacturing overhead underapplied or overapplied? manufacturing overhead (b) Why is the amount of underapplied (overapplied) manufacturing overhead different from Requirement 2 above? (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answers and double click the box with the question mark to empty the box for a wrong answers. Any boxes left with a question mark will be automatically graded as incorrect.) ? The predetermined overhead rate changed. The change in the actual manufacturing overhead cost directly resulted in a comparable change in the amount of underapplied (overapplied) manufacturing overhead. ?The change in the estimated total amount of the allocation base affected the amount of manufacturing overhead applied. Exercise 3-4 (Algo) Underapplied and Overapplied Overhead [LO3-4] Osborn Manufacturing uses a predetermined overhead rate of $19.40 per direct labor-hour. This predetermined rate was based on a cost formula that estimates $256,080 of total manufacturing overhead for an estimated activity level of 13,200 direct labor-hours. The company actually incurred $251,000 of manufacturing overhead and 12,700 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 overhead increase or decrease the company's gross margin? By how much? 1. Manufacturing overhead 2. The gross margin would by by Exercise 3-7 (Algo) Applying Overhead; Cost of Goods Manufactured [LO3-3, LO3-4] The following cost data relate to the manufacturing activities of Chang Company during the just completed year: Manufacturing overhead costs incurred: Indirect materials Indirect labor Property taxes, factory Utilities, factory Depreciation, factory Insurance, factory Total actual manufacturing overhead costs incurred Other costs incurred: Purchases of raw materials (both direct and indirect) Direct labor cost Inventories: Raw materials, beginning Raw materials, ending Work in process, beginning Work in process, ending $ 16,100 141,000 9,100 81,000 149,700 11,100 $ 408,000 $ 411,000 $ 71,000 $ 21,100 $ 31,100 $ 41,100 $ 71,100 The company uses a predetermined overhead rate of $20 per machine-hour to apply overhead cost to jobs. A total of 20,800 machine-hours were used during the year. Required: 1. Compute the amount of underapplied or overapplied overhead cost for the year. 2. Prepare a schedule of cost of goods manufactured for the year. Required: 1. Compute the amount of underapplied or overapplied overhead cost for the year. 2. Prepare a schedule of cost of goods manufactured for the year. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Compute the amount of underapplied or overapplied overhead cost for the year. overhead cost < Required 1 Required 2 > Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare a schedule of cost of goods manufactured for the year. Direct materials: Chang Company Schedule of Cost of Goods Manufactured Total raw materials available Raw materials used in production Direct materials used in production Total manufacturing costs added to production Total manufacturing costs to account for Cost of goods manufactured Required 1 $ 0 Required 2 > 0 0 Exercise 3-10 (Algo) Applying Overhead; Journal Entries; T-accounts [LO3-1, LO3-2] Dillon Products manufactures various machined parts to customer specifications. The company uses a job-order costing system and applies overhead cost to jobs on the basis of machine-hours. At the beginning of the year, the company used a cost formula to estimate that it would incur $4,305,000 in manufacturing overhead cost at an activity level of 574,000 machine-hours. The company spent the entire month of January working on a large order for 12,200 custom-made machined parts. The company had no work in process at the beginning of January. Cost data relating to January follow: a. Raw materials purchased on account, $315,000. b. Raw materials used in production, $270,000 (80% direct materials and 20% indirect materials). c. Labor cost accrued in the factory, $171,000 (one-third direct labor and two-thirds indirect labor). d. Depreciation recorded on factory equipment, $63,500. e. Other manufacturing overhead costs incurred on account, $85,500. f. Manufacturing overhead cost was applied to production on the basis of 40,980 machine-hours actually worked during the month. g. The completed job for 12,200 custom-made machined parts was moved into the finished goods warehouse on January 31 to await delivery to the customer. (In computing the dollar amount for this entry, remember that the cost of a completed job consists of direct materials, direct labor, and applied overhead.) Required: 1. Prepare journal entries to record items (a) through (f) above [ignore item (g) for the moment]. 2. Prepare T-accounts for Manufacturing Overhead and Work in Process. Post the relevant items from your journal entries to these T- accounts. 3. Prepare a journal entry for item (g) above. 4. If 10,300 of the custom-made machined parts are shipped to the customer in February, how much of this job's cost will be included in cost of goods sold for February? Complete the question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Prepare T-accounts for Manufacturing Overhead and Work in Process. Post the relevant items from your journal entries to these T-accounts. Ending Balance Manufacturing Overhead Debit Credit Debit Ending Balance < Required 1 Work in Process Required 3 > Credit Required 1 Required 2 Required 3 Required 4 Prepare journal entries to record items (a) through (f) above [ignore item (g) for the moment]. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round intermediate calculations.) View transaction list Journal entry worksheet 1 2 3 Raw materials purchased on account, $315,000. Note: Enter debits before credits. Transaction a. 4 5 6 Record entry General Journal Clear entry Debit Credit View general journal > Required 1 Required 2 Required 3 Prepare a journal entry for item (g) above. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet 1 Record the entry to transfer from WIP to Finished goods. Note: Enter debits before credits. Transaction g. Required 4 Record entry General Journal Clear entry Debit Credit View general journal Dillon Products manufactures various machined parts to customer specifications. The company uses a job-order costing system and applies overhead cost to jobs on the basis of machine-hours. At the beginning of the year, the company used a cost formula to estimate that it would incur $4,305,000 in manufacturing overhead cost at an activity level of 574,000 machine-hours. The company spent the entire month of January working on a large order for 12,200 custom-made machined parts. The company had no work in process at the beginning of January. Cost data relating to January follow: a. Raw materials purchased on account, $315,000. b. Raw materials used in production, $270,000 (80% direct materials and 20% indirect materials). c. Labor cost accrued in the factory, $171,000 (one-third direct labor and two-thirds indirect labor). d. Depreciation recorded on factory equipment, $63,500. e. Other manufacturing overhead costs incurred on account, $85,500. f. Manufacturing overhead cost was applied to production on the basis of 40,980 machine-hours actually worked during the month. g. The completed job for 12,200 custom-made machined parts was moved into the finished goods warehouse on January 31 to await delivery to the customer. (In computing the dollar amount for this entry, remember that the cost of a completed job consists of direct materials, direct labor, and applied overhead.) Required: 1. Prepare journal entries to record items (a) through (f) above [ignore item (g) for the moment]. 2. Prepare T-accounts for Manufacturing Overhead and Work in Process. Post the relevant items from your journal entries to these T- accounts. 3. Prepare a journal entry for item (g) above. 4. If 10,300 of the custom-made machined parts are shipped to the customer in February, how much of this job's cost will be included in cost of goods sold for February? Complete the question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 If 10,300 of the custom-made machined parts are shipped to the customer in February, how much of this job's cost will be included in cost of goods sold for February? (Round your intermediate calculations to 2 decimal places and final answer to the nearest whole dollar amount.) Portion of job cost included in cost of goods sold Required 3 Required 4 Problem 3-13 (Algo) Schedules of Cost of Goods Manufactured and Cost of Goods Sold; Income Statement [LO3-3] Superior Company provided the following data for the year ended December 31 (all raw materials are used in production as direct materials): Selling expenses Purchases of raw materials Direct labor Administrative expenses Manufacturing overhead applied to work in process Actual manufacturing overhead cost Inventory balances at the beginning and end of the year were as follows: Raw materials Work in process Finished goods Beginning $ 59,000 ? $ 31,000 Ending $ 33,000 $ 27,000 ? $ 217,000 $ 265,000 ? $ 156,000 $367,000 $ 355,000 The total manufacturing costs added to production for the year were $680,000; the cost of goods available for sale totaled $745,000; the unadjusted cost of goods sold totaled $663,000; and the net operating income was $31,000. The company's underapplied or overapplied overhead is closed to Cost of Goods Sold. Complete this question by entering your answers in the tabs below. Required: Prepare schedules of cost of goods manufactured and cost of goods sold and an income statement. (Hint: Prepare the income statement and schedule of cost of goods sold first followed by the schedule of cost of goods manufactured.) Complete this question by entering your answers in the tabs below. Income Statement COGS Schedule COGM Schedule Prepare an income statement for the year. Superior Company Income Statement Selling and administrative expenses: Income Statement COGS Schedule > Required: Prepare schedules of cost of goods manufactured and cost of goods sold and an income statement. (Hint: Prepare the income statement and schedule of cost of goods sold first followed by the schedule of cost of goods manufactured.) Complete this question by entering your answers in the tabs below. Income Statement COGS Schedule COGM Schedule Prepare a schedule of cost of goods sold. Superior Company Schedule of Cost of Goods Sold Adjusted cost of goods sold < Income Statement COGM Schedule Required: Prepare schedules of cost of goods manufactured and cost of goods sold and an income statement. (Hint: Prepare the income statement and schedule of cost of goods sold first followed by the schedule of cost of goods manufactured.) Complete this question by entering your answers in the tabs below. Income Statement COGS Schedule Direct materials: Prepare a schedule of cost of goods manufactured. Total raw materials available COGM Schedule Superior Company Schedule of Cost Goods Manufactured Direct materials used in production Cost of goods manufactured Total manufacturing costs added to production Total manufacturing costs to account for < COGS Schedule COGM Schedule