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Greenway Irrigation Systems uses job order costing and applies manufacturing overhead to individual jobs by using predetermined overhead rates. In the Fabrication Department, overhead is
Greenway Irrigation Systems uses job order costing and applies manufacturing overhead to individual jobs by using predetermined overhead rates. In the Fabrication Department, overhead is applied on the basis of machine hours, and in the Installation Department. It is applied on the basis of direct labor hours. At the beginning of the current year, management made the following budget estimates as a step toward determining the overhead application rates. Direct labor Manufacturing overhead Machine-hours Direct labor hours Fabrication Installation $ 132,000 $300,000 $600,000 $180,000 8,000 1,200 6,000 15,880 Production of a 5,350 linear-foot irrigation system for Thompson Orchards (job no. 399) was started and completed in March of the current year. Cost records for this job reveal the following information Fabrication Installation Job no. 399 (5,350 linear-foot system): Cost of materials used on job Direct labor cost Direct labor hours Machine-hours $ 7,200 1,800 80 60 $ 3,600 9,600 450 20 Required: a. Determine the overhead rate that should be used for each department in applying overhead costs to job no 399. b. What was the total cost of job no 399, and what was its cost per linear-foot? c. Prepare the journal entries required to record the sale (on account) of job no 399 to Thompson Orchards. The total sales price was $49.000 d. Assume that actual overhead costs for the year were $612.000 in the Fabrication Department, and S175,000 in the Installation Department Assume also that actual machine hours in the Fabrication Department were 8,200, and actual direct labor hours in the Installation Department were 14.500 during the year. On the basis of this information, determine the over-or underapplied overhead in each department for the year. Complete this question by entering your answers in the tabs below. Required A Required B Required Required D Determine the overhead rate that should be used for each department in applying overhead costs to job no. 399. Required A Required B Required c Required D Determine the overhead rate that should be used for each department in applying overhead costs to job ng Fabrication overhead application rate Installation overhead application rate per machine-hour per direct labor hour Complete this question by entering your answer Required A Required B Required c Required D What was the total cost of job no. 399, and what was it Total cost Unit cost $49,000. (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 > Record the sales on account. Note: Enter debits before credits. Transaction General Journal Debit Credit Record entry Clear entry View general Journal Required A Required B Required Required D Assume that actual overhead costs for the year were $612,000 in the Fabrication Department, and $175,000 in Installation Department. Assume also that actual machine-hours in the Fabrication Department were 8,200, an labor hours in the Installation Department were 14,500 during the year. On the basis of this information, determ or underapplied overhead in each department for the year. overhead Fabrication Installation overhead
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