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Yarra Fabrication estimates that its manufacturing overhead will be $2,240,000 in year 1. It further estimates that direct material costs will amount to $1,400,000. During July, Yarra worked on four jobs with actual direct materials costs of $60,000 for Job 0701, $40,000 for Job 0702, $55,000 for Job 0703, and $35,000 for Job 0704. Actual manufacturing overhead costs for the year were $2,400,000. Actual direct materials costs were $1,550,000. Manufacturing overhead is applied to jobs based on direct materials cost using predetermined rates. Required: a. How much overhead was applied to each of the four jobs, 0701, 0702, 0703, and 0704? b. What was the over- or underapplied manufacturing overhead for year 1?

Yarra Fabrication estimates that its manufacturing overhead will be $2,240,000 in year 1. It further estimates that direct material costs will amount to $1,400,000. During July, Yarra worked on four jobs with actual direct materials costs of $60,000 for Job 0701, $40,000 for Job 0702, $55,000 for Job 0703, and $35,000 for Job 0704. Actual manufacturing overhead costs for the year were $2,400,000. Actual direct materials costs were $1,550,000. Manufacturing overhead is applied to jobs based on direct materials cost using predetermined rates. Required: a. How much overhead was applied to each of the four jobs, 0701, 0702, 0703, and 0704? b. What was the over- or underapplied manufacturing overhead for year 1?

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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**Yarra Fabrication Manufacturing Overhead Analysis** Yarra Fabrication estimates its manufacturing overhead will be $2,240,000 in year 1. It further estimates that direct material costs will amount to $1,400,000. **July Job Costs:** - **Job 0701:** Actual direct materials cost of $60,000 - **Job 0702:** Actual direct materials cost of $40,000 - **Job 0703:** Actual direct materials cost of $55,000 - **Job 0704:** Actual direct materials cost of $35,000 **Year-End Totals:** - Actual manufacturing overhead costs for the year: $2,400,000 - Actual direct materials costs: $1,550,000 Manufacturing overhead is applied to jobs based on direct materials cost using predetermined rates. **Required:** **a. How much overhead was applied to each of the four jobs (0701, 0702, 0703, and 0704)?** **b. What was the over- or underapplied manufacturing overhead for year 1?** **Instructions:** Complete this question by entering your answers in the tabs provided. The interface includes tabs labeled "Required A" and "Required B" for input of overhead calculations and the determination of over- or underapplied overhead. **Table for Overhead Application to Jobs:** | Job Number | Overhead Applied | |------------|------------------| | Job 0701 | | | Job 0702 | | | Job 0703 | | | Job 0704 | | Users are prompted to fill in the overhead applied for each job based on the data provided.
Transcribed Image Text:**Yarra Fabrication Manufacturing Overhead Analysis** Yarra Fabrication estimates its manufacturing overhead will be $2,240,000 in year 1. It further estimates that direct material costs will amount to $1,400,000. **July Job Costs:** - **Job 0701:** Actual direct materials cost of $60,000 - **Job 0702:** Actual direct materials cost of $40,000 - **Job 0703:** Actual direct materials cost of $55,000 - **Job 0704:** Actual direct materials cost of $35,000 **Year-End Totals:** - Actual manufacturing overhead costs for the year: $2,400,000 - Actual direct materials costs: $1,550,000 Manufacturing overhead is applied to jobs based on direct materials cost using predetermined rates. **Required:** **a. How much overhead was applied to each of the four jobs (0701, 0702, 0703, and 0704)?** **b. What was the over- or underapplied manufacturing overhead for year 1?** **Instructions:** Complete this question by entering your answers in the tabs provided. The interface includes tabs labeled "Required A" and "Required B" for input of overhead calculations and the determination of over- or underapplied overhead. **Table for Overhead Application to Jobs:** | Job Number | Overhead Applied | |------------|------------------| | Job 0701 | | | Job 0702 | | | Job 0703 | | | Job 0704 | | Users are prompted to fill in the overhead applied for each job based on the data provided.
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