Question
Johnson Incorporated is a job-order manufacturing company that uses a predetermined overhead rate based on direct labor hours to apply overhead to individual jobs. For
Johnson Incorporated is a job-order manufacturing company that uses a predetermined overhead rate based on direct labor hours to apply overhead to individual jobs. For the current year, estimated direct labor hours are 85,000 and estimated factory overhead is $595,000. The following information is for September of the current year. Job A was completed during September, and Job B was started but not finished.
September 1, inventoriesMaterials inventory$7,600Work-in-process inventory (All Job A)31,400Finished goods inventory67,500Material purchases105,500Direct materials requisitionedJob A66,000Job B34,000Direct labor hoursJob A4,300Job B3,600Labor costs incurredDirect labor ($9.00/hour)71,100Indirect labor13,600Supervisory salaries6,100Rental costsFactory7,100Administrative offices1,900Total equipment depreciation costsFactory7,650Administrative offices1,750Indirect materials used12,100Required:
1. What is the total cost of Job A?
2. What is the total factory overhead applied during September?
3. What is the overapplied or underapplied overhead for September?
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