EXERCISE 3-34 (15 MINUTES) NOTE: Actual selling and administrative expense, although given in the exercise, is irrelevant to the solution 1. Predetermined overhead rate = $997,500 75,000 hours = $13.30 per hour 2. To compute actual manufacturing overhead: Depreciation Property taxes Indirect labor Supervisory salaries Utilities Insurance Rental of space Indirect material: $ 231,000 21,000 82,000 200,000 59,000 30,000 300,000 Beginning inventory, January 1......... ...... Add: Purchases............... Indirect material available for use......... Deduct: Ending inventory, December 31... Indirect material used......... Actual manufacturing overhead.... ...... $.48.000 94,000 ..S142.000 63.000 79,000 $1,002,000 actual manufacturing overhead Overapplied overhead - applied manufacturing overhead = $1,002,000 - ($13.30 x 80,000") = $62,000 *Actual direct-labor hours. 3. 62,000 Manufacturing Overhead... Cost of Goods Sold...... 62,000 EXERCISE 3-34 (15 MINUTES) NOTE: Actual selling and administrative expense, although given in the exercise, is irrelevant to the solution 1. Predetermined overhead rate = $997,500 75,000 hours = $13.30 per hour 2. To compute actual manufacturing overhead: Depreciation Property taxes Indirect labor Supervisory salaries Utilities Insurance Rental of space Indirect material: $ 231,000 21,000 82,000 200,000 59,000 30,000 300,000 Beginning inventory, January 1......... ...... Add: Purchases............... Indirect material available for use......... Deduct: Ending inventory, December 31... Indirect material used......... Actual manufacturing overhead.... ...... $.48.000 94,000 ..S142.000 63.000 79,000 $1,002,000 actual manufacturing overhead Overapplied overhead - applied manufacturing overhead = $1,002,000 - ($13.30 x 80,000") = $62,000 *Actual direct-labor hours. 3. 62,000 Manufacturing Overhead... Cost of Goods Sold...... 62,000