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The following cost data relate to the manufacturing activities of Construct Limited last year: Manufacturing overhead costs: Property taxes $6,750 Utilities, factory 8,500 Indirect labor

The following cost data relate to the manufacturing activities of Construct Limited last year:

Manufacturing overhead costs:

Property taxes

$6,750

Utilities, factory

8,500

Indirect labor

10,125

Depreciation, factory

26,250

Insurance, factory

8,375

Total

$60,000

Other costs incurred:

Purchases of direct materials

$45,000

Direct labor cost

$48,150

Inventories:

Direct materials, January 1

$5,600

Direct materials, December 31

$7,750

Work in process, January 1

$6,700

Work in process, December 31

$8,200

The company uses a predetermined overhead rate to apply manufacturing overhead cost to production. The rate last year was $9.00 per machine-hour; a total of 7,000 machine-hours were recorded for the year.

Required:

  1. Calculate the amount of applied overhead. (1 marks)
  2. Calculate the amount and specify underapplied or overapplied overhead cost for the year. (2 marks)
  3. Prepare a schedule of Cost of Goods Manufactured for the year. Show all items. (12 marks)

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