Granite Company uses a job order cost system. The company applies manufacturing overhead to jobs using a predetermined overhead rat based on direct labor-hours. Last year, manufacturing overhead and direct labor-hours were estimated at $80,000 and 16,000 hours respectively, for the year. In June, . At the end of the year, it was determined that the company worked 15,000 direct labor-hours for the year, and incurred $78,000 in actual manufacturing overhead costs. Required:Determine the predetermined overhead rate for the year.Determine the amount of overhead charged to jobs during the year.Determine the amount of under- or over applied overhead of the year.

Name: Granite Company uses a job order cost system. The company applies manu
Uploaded: 2024-03-20T06:33:06.000Z
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Description: Granite Company uses a job order cost system. The company applies manufacturing overhead to jobs using a predetermined overhead rat based on direct labor-hours. Last year, manufacturing overhead and direct labor-hours were estimated at $80,000 and 16

Formula: Predetermined overhead rate = Manufacturing overhead / direct labor hours.

Answered: Granite Company uses a job order cost…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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Granite Company uses a job order cost system. The company applies manufacturing overhead to jobs using a predetermined overhead rat based on direct labor-hours. Last year, manufacturing overhead and direct labor-hours were estimated at $80,000 and 16,000 hours respectively, for the year. In June, . At the end of the year, it was determined that the company worked 15,000 direct labor-hours for the year, and incurred $78,000 in actual manufacturing overhead costs.

Required:

Determine the predetermined overhead rate for the year.
Determine the amount of overhead charged to jobs during the year.
Determine the amount of under- or over applied overhead of the year.

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