QS 19-8 Predetermined overhead rate LO P3

At the beginning of a year, a company predicts total direct materials costs of $1,080,000 and total overhead costs of $1,350,000. If the company uses direct materials costs as its activity base to allocate overhead, what is the predetermined overhead rate it should use during the year?

QS 19-9 Applying overhead LO P3

On March 1 a dressmaker starts work on three custom-designed wedding dresses. The company uses job order costing and applies overhead to each job (dress) at the rate of 43% of direct materials costs. During the month, the jobs used direct materials as shown below. Compute the amount of overhead applied to each of the three jobs.

	Job 1			Job 2			Job 3
Direct materials used	$	5,200		$	7,200		$	1,700

QS 19-10 Manufacturing cost flows LO P1, P2, P3

On March 1 a dressmaker starts work on three custom-designed wedding dresses. The company uses job order costing and applies overhead to each job (dress) at the rate of 44% of direct materials costs. During the month, the jobs used direct materials as shown below.

	Job 1			Job 2			Job 3
Direct materials used	$	6,900		$	8,900		$	3,400

During the month, the jobs used direct labor as shown below. Jobs 1 and 3 are not finished by the end of March, and Job 2 is finished but not sold by the end of March.

	Job 1			Job 2			Job 3
Direct labor used	$	9,700		$	5,600		$	4,600

1. Determine the amounts of direct materials, direct labor, and factory overhead applied that would be reported on job cost sheets for each of the three jobs for March.

2. Determine the total dollar amount of Work in Process Inventory at the end of March.

3. Determine the total dollar amount of Finished Goods Inventory at the end of March. Assume the company has no beginning Work in Process or Finished Goods inventories.