Question
[The following information applies to the questions displayed below.] The Gilster Company, a machine tooling firm, has several plants. One plant, located in St. Falls,
[The following information applies to the questions displayed below.] The Gilster Company, a machine tooling firm, has several plants. One plant, located in St. Falls, Minnesota, uses a job order costing system for its batch production processes. The St. Falls plant has two departments through which most jobs pass. Plantwide overhead, which includes the plant managers salary, accounting personnel, cafeteria, and human resources, is budgeted at $360,000. During the past year, actual plantwide overhead was $340,000. Each departments overhead consists primarily of depreciation and other machine-related expenses. Selected budgeted and actual data from the St. Falls plant for the past year are as follows. Department A Department B Budgeted department overhead (excludes plantwide overhead) $ 100,000 $ 282,000 Actual department overhead 120,000 302,000 Expected total activity: Direct labor hours 38,000 20,000 Machine-hours 20,000 47,000 Actual activity: Direct labor hours 39,000 18,700 Machine-hours 20,800 49,000 For the coming year, the accountants at St. Falls are in the process of helping the sales force create bids for several jobs. Projected data pertaining only to job no. 110 are as follows. Direct materials $ 25,000 Direct labor cost: Department A (2,800 hr) 42,000 Department B (1,500 hr) 14,000 Machine-hours projected: Department A 170 Department B 1,200 Units produced 9,000 d. Using the allocation rates in part b, compute the under- or overapplied overhead for the St. Falls plant for the year. (Round your intermediate calculations to 2 decimal places.)
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