Marco Company shows the following costs for three jobs worked on in April.Job 306$ 29,00020,00010,000Balances on March 31Direct materials used (in March)Direct labor used (in March)Overhead applied (March)Costs during AprilDirect materials usedDirect labor usedOverhead appliedStatus on April 30Predetermined overhead rateOverhead appliedRequired:1. Determine the amount of overhead applied to each job in April.306135,00085,000?0.50Finished(sold)3070.50Job 307Additional Informationa. Raw Materials Inventory has a March 31 balance of $80,000.b. Raw materials purchases in April are $500,000, and total factory payroll cost in April is $363,000.c. Actual overhead costs incurred in April are indirect materials, $50,000; indirect labor, $23,000; factory rent, $32,000;factory utilities, $19,000; and factory equipment depreciation, $51,000.d. Predetermined overhead rate is 50% of direct labor cost.e. Job 306 is sold for $635,000 cash in April.308$ 35,00018,0009,000220,000150,000?Finished(unsold)Job 3080.50$ 100,000105,000?In processApril Total0.50

Answered: Determine the amount of overhead…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Marco Company shows the following costs for three jobs worked on in April.
Job 306
$ 29,000
20,000
10,000
Balances on March 31
Direct materials used (in March)
Direct labor used (in March)
Overhead applied (March)
Costs during April
Direct materials used
Direct labor used
Overhead applied
Status on April 30
Predetermined overhead rate
Overhead applied
Required:
1. Determine the amount of overhead applied to each job in April.
306
135,000
85,000
?
0.50
Finished
(sold)
307
0.50
Job 307
Additional Information
a. Raw Materials Inventory has a March 31 balance of $80,000.
b. Raw materials purchases in April are $500,000, and total factory payroll cost in April is $363,000.
c. Actual overhead costs incurred in April are indirect materials, $50,000; indirect labor, $23,000; factory rent, $32,000;
factory utilities, $19,000; and factory equipment depreciation, $51,000.
d. Predetermined overhead rate is 50% of direct labor cost.
e. Job 306 is sold for $635,000 cash in April.
308
$ 35,000
18,000
9,000
220,000
150,000
?
Finished
(unsold)
Job 308
0.50
$ 100,000
105,000
?
In process
April Total
0.50

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Overhead allocation means assigning overhead costs to units of products or jobs. Some firms employ the predetermined overhead rate, while others employ the ABC overhead rates based on the activity levels.

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