Problem 2: Overhead Application using a Predetermined Overhead Rate Tiana Shar, the controller for Bondi Furniture Company, is in the process of analysing the overhead costs for the month of November. She has gathered the following date for the month. Labour Direct-abour hours ob 77 ob 78 ob 79 3,000 Labour costs Direct-labour wages Indirect-labour wages Su S204, 000 15, 000 Material Inventory, November 1 Raw material and supplies Work in Finished goods Ss (job 7 112, 500 Purchases of raw materials and supplies Raw material Supplies (indirect material $135,000 15, 000 Direct material and supplies r sitioned for production ob 77 ob 78 ob 79 Supplies (indirect material $120, 000 Total Other Building light, depreciation etc ancy costs $ 6.400 1, 600 Factory facilities Sales offices Administrative offices Total Production equipment costs: $4, 100 1, 500 1, 500 1,000 S 8, 100 Power Repairs and maintenance Depreciation Other Total The firm's job order costing system uses direct-labour-hours (measured at practical capacity) as the cost driver for overhead application. In December of the preceding year, Shar had prepared Problem solving assignment Page 2 of 10 the following budgeted for direct-labour and manufacturing overhead costs for the current year The plant is theoretically capable of operating at 150, 000 direct-labour hours per year. However Shar estimates that the practical capacity is 120,000 hours in a typical year Manufacturing overhead Variable Direct-labour hours Fixed 100, 000 120, 000 140, 000 325, 000 390, 000 455, 000 216, 000 216, 000 During November the following jobs were completed: Job 77 Job 78 Side chairs End tables Required: Assist Shar by making the following calculations Required: Assist Shar by making the following calculations. 1. Calculate the predetermined overhead rate for the current year. 2. Calculate the total cost of job 77. 3. Computer the amount of manufacturing overhead applied to job 79 during November 4. What was the total amount of manufacturing overhead applied during November? 5. Compute the actual manufacturing overhead incurred during November. 6. Calculate the overapplied or underappied tor November