PLEASE FIND PREDETERMINED OVERHEAD RATE
- Please Find Predetermined Overhead Rate 1 (165.45 KiB) Viewed 35 times
Ivanhoe
Company uses a job order cost system and applies overhead to production on the basis of direct labor costs. On January 1, 2022, Job 50 was the only job in process. The costs incurred prior to January 1 on this job were as follows: direct materials $17,200, direct labor $10,320, and manufacturing overhead $13,760. As of January 1, Job 49 had been completed at a cost of $77,400 and was part of finished goods inventory. There was a $12,900 balance in the Raw Materials Inventory account on January 1. During the month of January, Ivanhoe
Company began production on Jobs 51 and 52, and completed Jobs 50 and 51. Jobs 49 and 50 were sold on account during the month for $104,920 and $135,880, respectively. The following additional events occurred during the month. 1. Purchased additional raw materials of $77,400 on account. Incurred factory labor costs of $60,200. Incurred manufacturing overhead costs as follows: depreciation expense on equipment $10,320; and various other manufacturing overhead costs on account $13,760. Assigned direct materials and direct labor to jobs as follows. 2. 3. 4. 5. Job No. Direct Materials 50 51 52 $8,600 33,540 25,800 Direct Labor $4,300 21,500 17,200 Assigned indirect materials of $14,620 and indirect labor of $17,200.
(a) Calculate the predetermined overhead rate for 2022, assuming Ivanhoe
Company estimates total manufacturing overhead costs of $722,400, direct labor costs of $602,000, and direct labor hours of 17,200 for the year. Predetermined overhead rate do %