Ozone Products provided the following information for 2004: Materials: Materials inventory, January 1........................ $ 75,000 Purchases......................................................... 526,000 Direct materials issued .................................... 525,000 Indirect materials issued.................................. 27,000 Labor: Direct labor cost (22,000 hours)..................... $150,000 Indirect labor................................................... 35,000 Other factory costs: Depreciation.................................................... $175,000 Maintenance .................................................... 85,000 Supervision...................................................... 46,000 Planning and control ....................................... 44,000 Miscellaneous.................................................. 12,000 Work in process: Beginning inventory........................................ $ 25,000 Ending inventory............................................. 34,000 Finished goods: Beginning inventory........................................ $ 56,000 Ending inventory............................................. 42,000 The company uses a predetermined overhead rate based on direct labor hours. The rate for 2004 was $22.00 per direct labor hour. Required: 10. Compute the applied overhead for 2004. 11. Compute the actual overhead for 2004. 12. Is the overhead over- or underapplied? By how much?
Ozone Products provided the following information for 2004:
Materials:
Materials inventory, January 1........................ $ 75,000
Purchases......................................................... 526,000
Direct materials issued .................................... 525,000
Indirect materials issued.................................. 27,000
Labor:
Direct labor cost (22,000 hours)..................... $150,000
Indirect labor................................................... 35,000
Other
Depreciation.................................................... $175,000
Maintenance .................................................... 85,000
Supervision...................................................... 46,000
Planning and control ....................................... 44,000
Miscellaneous.................................................. 12,000
Work in process:
Beginning inventory........................................ $ 25,000
Ending inventory............................................. 34,000
Finished goods:
Beginning inventory........................................ $ 56,000
Ending inventory............................................. 42,000
The company uses a predetermined
direct labor hour.
Required:
10. Compute the applied overhead for 2004.
11. Compute the actual overhead for 2004.
12. Is the overhead over- or underapplied? By how much?
13. How much is the COGS if over/under applied FOH will be closed to COGS?
14. How much is the Finished Goods ending balance if over/under applied FOH will be allocated to WIP, FG, and
COGS?
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