Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Gitano Products uses job - order costing and applies overhead cost to jobs based on direct materials used in production ( not on the basis

Gitano Products uses job-order costing and applies overhead cost to jobs based on direct materials used in production (not on the basis of raw materials purchased). Its predetermined overhead rate is based on a cost formula that estimated $111,600 of manufacturing overhead for an estimated allocation base of $93,000 direct material dollars to be used in production. The company provided the following data for the just completed year:
Purchase of raw materials $ 139,000
Direct labor cost $ 89,000
Manufacturing overhead costs:
Indirect labor $ 99,200
Property taxes $ 8,400
Depreciation of equipment $ 16,000
Maintenance $ 13,000
Insurance $ 10,200
Rent, building $ 34,000
Beginning Ending
Raw Materials $ 21,000 $ 13,000
Work in Process $ 48,000 $ 36,000
Finished Goods $ 73,000 $ 62,000
Required:
Compute the predetermined overhead rate.
Compute the amount of underapplied or overapplied overhead.
Prepare a schedule of cost of goods manufactured. Assume all raw materials are used in production as direct materials.
Compute the unadjusted cost of goods sold. Do not include any underapplied or overapplied overhead in your answer.
Assume the $36,000 ending balance in Work in Process includes $8,500 of direct materials. Given this assumption, supply the information missing below:

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting Information Systems

Authors: Marshall B. Romney

8th Edition

0201357216, 9780201357219

More Books

Students also viewed these Accounting questions

Question

In what ways can confl ict enrich relationships?

Answered: 1 week ago

Question

How do listening and hearing diff er?

Answered: 1 week ago

Question

How does eff ective listening diff er across listening goals?

Answered: 1 week ago