Mary Rose Company applies manufacturing overhead to jobs on the basis of machine hours used. Overhead Cost are expected to be 550,000 for the year and the machine usage is estimated at 250,000 hours. In the month of January, 52,000 of overhead cost are incurred and and 10,000 machine hours are used. For the remainder of the year, 548,000 of overhead cost are incurred and 240,000 machine hours are worked. Required: 1. The manufacturing overhead for the year is? 2. Over or under applied overhead for January is? 3. Over or under applies overhead for December 31 is?
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
Mary Rose Company applies manufacturing
Required:
1. The manufacturing overhead for the year is?
2. Over or under applied overhead for January is?
3. Over or under applies overhead for December 31 is?
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