led in ' NO. E RM ATF op f Question 1 A). State the order (sequence) in which the income statement, the statement of retained earnings and company's statement of financial position (balance sheet) are to be prepared and why? B). TruEarth Company uses a job order cost system in each of its three manufacturing departments. Manufacturing overhead is applied to jobs on the basis of direct labor cost in Department A, direct labor hours in Department B, and machine hours in Department C. In establishing the predetermined overhead rates for 2023, the following estimates were made for the year. Manufacturing overhead $720,000 Direct labor cost Direct labor hours Machine hours A Department B $640,000 $900,000 C $600,000 $100,000 $600,000 50,000 100,000 40,000 40,000 120,000 150,000 During April, the job cost sheets showed the following costs and production data. Tick alem Alsgh Direct materials used Direct labor cost Manufacturing overhead incurred Direct labor hours Machine hours Department A B C $92,000 $86,000 $64,000 $48,000 $35,000 $50,400 $60,000 $60,000 $72,100 4,000 3,500 4,200 8,000 10,500 12,600 a) Compute the predetermined overhead rate for each department. b) Compute the total manufacturing costs assigned to jobs in April in each department. c) Compute the under or over applied overhead for each department at April 30.
led in ' NO. E RM ATF op f Question 1 A). State the order (sequence) in which the income statement, the statement of retained earnings and company's statement of financial position (balance sheet) are to be prepared and why? B). TruEarth Company uses a job order cost system in each of its three manufacturing departments. Manufacturing overhead is applied to jobs on the basis of direct labor cost in Department A, direct labor hours in Department B, and machine hours in Department C. In establishing the predetermined overhead rates for 2023, the following estimates were made for the year. Manufacturing overhead $720,000 Direct labor cost Direct labor hours Machine hours A Department B $640,000 $900,000 C $600,000 $100,000 $600,000 50,000 100,000 40,000 40,000 120,000 150,000 During April, the job cost sheets showed the following costs and production data. Tick alem Alsgh Direct materials used Direct labor cost Manufacturing overhead incurred Direct labor hours Machine hours Department A B C $92,000 $86,000 $64,000 $48,000 $35,000 $50,400 $60,000 $60,000 $72,100 4,000 3,500 4,200 8,000 10,500 12,600 a) Compute the predetermined overhead rate for each department. b) Compute the total manufacturing costs assigned to jobs in April in each department. c) Compute the under or over applied overhead for each department at April 30.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text:led in '
NO.
E
RM
ATF
op
f
Question 1
A). State the order (sequence) in which the income statement, the statement of retained
earnings and company's statement of financial position (balance sheet) are to be prepared
and why?
B). TruEarth Company uses a job order cost system in each of its three manufacturing
departments. Manufacturing overhead is applied to jobs on the basis of direct labor cost in
Department A, direct labor hours in Department B, and machine hours in Department C.
In establishing the predetermined overhead rates for 2023, the following estimates were made
for the year.
Manufacturing overhead $720,000
Direct labor cost
Direct labor hours
Machine hours
A
Department
B
$640,000 $900,000
C
$600,000
$100,000
$600,000
50,000
100,000
40,000
40,000
120,000
150,000
During April, the job cost sheets showed the following costs and production data.
Tick
alem Alsgh
Direct materials used
Direct labor cost
Manufacturing overhead incurred
Direct labor hours
Machine hours
Department
A
B
C
$92,000 $86,000 $64,000
$48,000 $35,000 $50,400
$60,000 $60,000 $72,100
4,000 3,500 4,200
8,000 10,500 12,600
a) Compute the predetermined overhead rate for each department.
b) Compute the total manufacturing costs assigned to jobs in April in each department.
c) Compute the under or over applied overhead for each department at April 30.
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