Question
Lane Company manufactures a single product that requires a great deal of hand labor. Overhead cost is applied on the basis of standard direct labor-hours.
Lane Company manufactures a single product that requires a great deal of hand labor. Overhead cost is applied on the basis of standard direct labor-hours. The budgeted variable manufacturing overhead is $2.60 per direct labor-hour and the budgeted fixed manufacturing overhead is $495,000 per year.
The standard quantity of materials is 4 pounds per unit and the standard cost is $4.50 per pound. The standard direct labor-hours per unit is 1.5 hours and the standard labor rate is $12.30 per hour.
The company planned to operate at a denominator activity level of 75,000 direct labor-hours and to produce 50,000 units of product during the most recent year. Actual activity and costs for the year were as follows:
Actual number of units produced | 60,000 | |
Actual direct labor-hours worked | 97,500 | |
Actual variable manufacturing overhead cost incurred | $ | 165,750 |
Actual fixed manufacturing overhead cost incurred | $ | 536,250 |
Required:
3b. Complete the following Manufacturing Overhead T-account for the year.
Having issues completing 3b. Please help. Thanks!
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