is a company that produces machinery to customer order. Its job costing system, using
normal costing, has two direct cost categories, direct materials and direct labor, and one indirect
cost pool, manufacturing overhead, allocated using a budgeted rate based on direct labor costs.
Budgeted and actual information for 2016 are as follows:
Budget
$420,000 $400,000
$252,000 $186,840
Direct Labor
Manufacturing overhead
At the end of 2016, the ending work in process consisted of:
Ending Work In Process:
Direct Materials
Direct Labor
Overhead
Actual
$64,000
50,000
30,000
$144,000
There were no beginning work-in-process or finished-goods inventories. Ending Finished Goods
showed a balance of $156,000, which included overhead costs of $25,200.
Cost of goods sold was $1,600,000, of which $184,800 consisted of applied overhead./n4. Calculate the underlove rapplied overhead for 2016.
Fig: 1
Fig: 2