O'Leary Corporation manufactures special purpose portable structures (huts, mobile offices, and so on) for use at construction sites. It only builds to order (each unit is built to customer specifications). O'Leary uses a normal job costing system. Direct labor at O'Leary is paid $24 per hour, but the employees are not paid if they are not working on jobs. Manufacturing overhead is assigned to jobs by a predetermined rate on the basis of direct labor-hours. The company incurred manufacturing overhead costs during two recent years (adjusted for price-level changes using current prices and wage rates) as follows Year 1 68,480 Year 2 55,400 Direct labor-hours worked Manufacturing overhead costs incurred Indirect labor Employee benefits Supplies Power Heat and light Supervision Depreciation Property taxes and insurance Total manufacturing overhead costs $2,816,000 1,026,000 684, 641, eee 140,800 780, 310 2,224,500 779, 390 $8,892,000 $2,216,000 831,000 554,098 536,000 148,888 662,450 2,224,500 793,250 $7,756,000 At the beginning of year 3, O'Leary has two jobs, which have not yet been delivered to customers. Job MC-270 was completed on December 27 year 2. It is scheduled to ship on January 7 year 3. Job MC-275 is still in progress. For the purpose of computing the predetermined overhead rate, O'Leary uses the previous year's actual overhead rate. Data on direct material costs and direct labor hours for these jobs in year 2 follow. Job MC-270 Job MC-275 Direct material costs $271,400 $496,400 Direct labor-hours 2,578 hours 3,270 hours During year 3, O'Leary incurred the following direct material costs and direct labor-hours for all jobs worked in year 3, including the completion of Job MC-275. Direct material costs Direct labor-hours Actual manufacturing overhead $11,841,488 75,400 $ 9,456, At the end of year 3, there were four jobs that had not yet shipped. Data on these jobs follow. Direct materials Direct labor-hours Job status MC-389 $44,600 1,754 hours Finished MC-390 $68,400 2,770 hours Finished MC-397 $184,900 6,170 hours In progress MC-399 $30,380 1,370 hours In progress Required: a. What was the amount in the beginning Finished Goods and beginning Work-In-Process accounts for year 3? b. O'Leary incurred direct materials costs of $58,400 and used an additional 440 hours in year 3 to complete Job MC-275. What was the final (total) cost charged to job MC-275? c. What was over- or underapplied overhead for year 3? d. O'Leary prorates any over or underapplied overhead to Cost of Goods Sold, Finished Goods Inventory, and Work in Process Inventory. Prepare the journal entry to prorate the over- or underapplied overhead, e. A customer has asked O'Leary to bid on a job to be completed in year 4. O'Leary estimates that the job will require about $93,200 in direct materials and 5,070 direct labor-hours. Because of the economy, O'Leary expects demand for its services to be low in year 4 and the CEO wants to bid aggressively, but does not want to lose any money on the project. O'Leary estimates that there would be virtually no sales or administrative costs associated with this job. What is the minimum amount O'Leary can bid on the job and still not incur a loss? Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Required E What was the amount in the beginning Finished Goods and beginning Work-in-process accounts for year 3? Work-in-process inventory Finished goods inventory O'Leary Corporation manufactures special purpose portable structures (huts, mobile offices, and so on) for use at construction sites. It only builds to order (each unit is built to customer specifications). O'Leary uses a normal job costing system. Direct labor at O'Leary is paid $24 per hour, but the employees are not paid if they are not working on jobs. Manufacturing overhead is assigned to jobs by a predetermined rate on the basis of direct labor-hours. The company incurred manufacturing overhead costs during two recent years (adjusted for price-level changes using current prices and wage rates) as follows Year 1 68,480 Year 2 55,400 Direct labor-hours worked Manufacturing overhead costs incurred Indirect labor Employee benefits Supplies Power Heat and light Supervision Depreciation Property taxes and insurance Total manufacturing overhead costs $2,816,000 1,026,000 684, 641, eee 140,800 780, 310 2,224,500 779, 390 $8,892,000 $2,216,000 831,000 554,098 536,000 148,888 662,450 2,224,500 793,250 $7,756,000 At the beginning of year 3, O'Leary has two jobs, which have not yet been delivered to customers. Job MC-270 was completed on December 27 year 2. It is scheduled to ship on January 7 year 3. Job MC-275 is still in progress. For the purpose of computing the predetermined overhead rate, O'Leary uses the previous year's actual overhead rate. Data on direct material costs and direct labor hours for these jobs in year 2 follow. Job MC-270 Job MC-275 Direct material costs $271,400 $496,400 Direct labor-hours 2,578 hours 3,270 hours During year 3, O'Leary incurred the following direct material costs and direct labor-hours for all jobs worked in year 3, including the completion of Job MC-275. Direct material costs Direct labor-hours Actual manufacturing overhead $11,841,488 75,400 $ 9,456, At the end of year 3, there were four jobs that had not yet shipped. Data on these jobs follow. Direct materials Direct labor-hours Job status MC-389 $44,600 1,754 hours Finished MC-390 $68,400 2,770 hours Finished MC-397 $184,900 6,170 hours In progress MC-399 $30,380 1,370 hours In progress Required: a. What was the amount in the beginning Finished Goods and beginning Work-In-Process accounts for year 3? b. O'Leary incurred direct materials costs of $58,400 and used an additional 440 hours in year 3 to complete Job MC-275. What was the final (total) cost charged to job MC-275? c. What was over- or underapplied overhead for year 3? d. O'Leary prorates any over or underapplied overhead to Cost of Goods Sold, Finished Goods Inventory, and Work in Process Inventory. Prepare the journal entry to prorate the over- or underapplied overhead, e. A customer has asked O'Leary to bid on a job to be completed in year 4. O'Leary estimates that the job will require about $93,200 in direct materials and 5,070 direct labor-hours. Because of the economy, O'Leary expects demand for its services to be low in year 4 and the CEO wants to bid aggressively, but does not want to lose any money on the project. O'Leary estimates that there would be virtually no sales or administrative costs associated with this job. What is the minimum amount O'Leary can bid on the job and still not incur a loss? Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Required E What was the amount in the beginning Finished Goods and beginning Work-in-process accounts for year 3? Work-in-process inventory Finished goods inventory