Exercise 4-12 Applying Overhead; Cost of Goods Manufactured [LO4-2, LO4-4, LO4-6]

The following cost data relate to the manufacturing activities of Black Company during the just completed year:

Manufacturing overhead costs: Property taxes, factory $ 3,000 Utilities, factory 5,000 Indirect labor 10,000 Depreciation, factory 24,000 Insurance, factory 6,000 Total actual manufacturing overhead costs $ 48,000 Other costs incurred: Purchases of raw materials $ 32,000 Direct labor cost $ 40,000 Inventories: Raw materials, beginning $ 8,000 Raw materials, ending $ 7,000 Work in process, beginning $ 6,000 Work in process, ending $ 7,500

The company uses a predetermined overhead rate to apply overhead cost to jobs. The rate for the year was $5 per machine-hour; a total of 10,000 machine-hours was recorded for the year. All raw materials ultimately become direct materialsnone are classified as indirect materials.

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 using the indirect method. (Enter all deductions as a negative.)