Question : 81. Austin Company uses a job order cost accounting system. : 1256493

 

 

81. Austin Company uses a job order cost accounting system. The company’s executives estimated that direct labor would be $2,000,000 (200,000 hours at $10/hour) and that factory overhead would be $1,500,000 for the current period. At the end of the period, the records show that there had been 180,000 hours of direct labor and $1,200,000 of actual overhead costs. Using direct labor hours as the allocation base, calculate the under- or overapplied overhead for the period.A. $150,000 overapplied.B. $150,000 underapplied.C. $300,000 underapplied.

D. $300,000 overapplied.E. $200,000 underapplied.

 

 

 

 

82. The R&R Company’s manufacturing costs for August are: direct labor, $13,000; indirect labor, $6,500; direct materials, $15,000; taxes on raw materials and work in process, $800; heat, lights, and power, $1,000; and insurance on plant and equipment, $200. R&R Company’s factory overhead incurred for August is:A. $2,000B. $6,500C. $8,500D. $21,500E. $36,500

 

 

83. Deltan Corp. allocates overhead to production on the basis of direct labor costs. If Deltan’s total estimated overhead is $450,000 and estimated direct labor cost is $180,000, determine the amount of overhead to be allocated to finished goods inventory. There is $20,000 of total direct labor cost in the jobs in the finished goods inventory.A. $8,000B. $20,000C. $70,000D. $50,000E. $90,000

 

 

 

 

 

 

 

 

84. A company allocates overhead to production on the basis of direct labor cost. If the company’s total estimated overhead is $870,000 and estimated direct labor cost is $1,160,000, determine the amount of overhead to be allocated to finished goods inventory. There is $791,000 of total direct labor cost in the jobs in the finished goods inventory.A. $1,054,667B. $593,250C. $1,275,853D. $1,079,482E. $79,000

 

 

85. The Goods in Process Inventory account of a manufacturing company that uses an overhead rate based on direct labor cost has a $4,400 debit balance after all posting is completed. The cost sheet of the one job still in process shows direct material cost of $2,000 and direct labor cost of $800. Therefore, the company’s overhead application rate is:A. 40%B. 50%C. 80%D. 200%E. 220%

 

 

 

 

 

86. The Goods in Process Inventory account of a manufacturing company that uses an overhead rate based on direct labor cost has a $7,750 debit balance after all posting is completed. The cost sheet of the one job still in process shows direct material cost of $6,000 and direct labor cost of $1,000. Therefore, the company’s overhead application rate is:A. 10.7%B. 75.0%C. 133.0%D. 90.3%E. 111.0%

 

 

87. Using the following accounts and an overhead rate of 90% of direct labor cost, determine the amount of applied overhead. 

 

Goods in Process Inventory

 

Finished Goods Inventory

 

 

Beg. Bal. 17,600

 

 

Beg. Bal.   5,200

 

 

 

D.M.        52,800

 

 

201,520

 

 

 

D.L.                  ?

 

 

 

 

 

 

O.H.                  ?

F. G.           ?

 

 

 

 

 

End. Bal. 36,080

 

 

 

 

 

 

 

 

 

 

 

 

A. $79,200B. $167,200C. $34,320D. $88,000E. $35,376

 

 

88. Using the following accounts and an overhead rate of 80% of direct labor cost, determine the amount of applied overhead. 

 

Goods in Process Inventory

 

Finished Goods Inventory

 

 

Beg. Bal. 53,000

 

 

Beg. Bal.   9,000

 

 

 

D.M.        48,000

 

 

200,000

129,000

 

 

D.L.                  ?

 

 

 

 

 

 

O.H.                  ?

F. G.           ?

 

 

 

 

 

End. Bal. 36,000

 

 

End. Bal. 80,000

 

 

 

 

 

 

 

 

 

A. $135,000B. $75,000C. $60,000D. $101,000E. $17,000

 

 

89. If one unit of Product X used $2.50 of direct materials and $3.00 of direct labor, sold for $8.00, and was assigned overhead at the rate of 30% of direct labor costs, how much gross profit was realized from this sale? A. $8.00B. $5.50C. $2.50D. $1.60E. $0.90

 

 

90. If one unit of Product X used $.75 of direct materials and $6.00 of direct labor, sold for $12.00, and was assigned overhead at the rate of 20% of direct labor costs, how much gross profit was realized from this sale?A. $12.00B. $6.75C. $.75D. $1.20E. $4.05