At the beginning of the year, Capital Manufacturing established its predetermined overhead rate by using the following cost predictions: Overhead costs $960,000 Direct materials costs $320,000 At year-end, the company's records show that the actual overhead for the year is $1,720,500. Actual direct materials cost had been assigned to jobs as follows: Jobs completed and sold $450,000 Jobs in finished goods inventory $78,000 Jobs in work in process inventory $52,000 Total actual direct materials cost $580,000 Determine the predetermined overhead rate.

At the beginning of the year, Capital Manufacturing established its predetermined overhead rate by using the following cost predictions: Overhead costs $960,000 Direct materials costs $320,000 At year-end, the company's records show that the actual overhead for the year is $1,720,500. Actual direct materials cost had been assigned to jobs as follows: Jobs completed and sold $450,000 Jobs in finished goods inventory $78,000 Jobs in work in process inventory $52,000 Total actual direct materials cost $580,000 Determine the predetermined overhead rate.

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter3: Process Cost Systems

Section: Chapter Questions

Problem 4E: The cost accountant for River Rock Beverage Co. estimated that total factory overhead cost for the...

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