Sartre Fabrics computes its predetermined overhead rate annually on the basis of direct labor hours. At the beginning of the year, it estimated that 40,000 direct labor hours would be required for the periods estimated level of production. The company also estimated $188,000 of fixed manufacturing overhead expenses for the coming period and variable manufacturing overhead of $2.00 per direct labor hour. Sartre's actual manufacturing overhead for the year was $247,800 and its actual total direct labor was 42,000 hours.

Required:

Compute the companys predetermined overhead rate for the year. What was the amount of overhead applied in the year? How much was the under or over-applied overhead? Prepare the journal entry to close out the over or under-applied overhead to Cost of Goods Sold.

The Lopez Company uses a job-order costing system at its local plant. The plant has a machining department and a finishing department. The company uses machine hours to allocate machining department overhead costs to jobs and uses direct labor cost to allocate finishing department overhead costs to jobs. Cost and practical capacity estimates for the current year are as follows:

	Machining Department	Finishing Department
Manufacturing overhead costs	$700,000	$560,000
Machine hours	28,000	2,800
Direct labor hours	7,000	30,800
Direct labor cost	$210,000	$700,000

Required:

1. Determine the cost driver rate for each department?
2. Cost records for job 101 show the following:?
3. Determine the total cost charged to job 101?

	Machining Department	Finishing Department
Direct materials cost	$16,000	$2,800
Direct labor cost	$500	$1,600
Direct labor hours	14	70
Machine hours	100	12