
1.
The cost of indirect material, labor and other expenses is the overhead cost. This cost is overhead cost as it is not related to the cost of production directly. The example of overhead cost is administration cost, selling and distribution cost and other costs.
The amount of direct material issued to production.
2.
The amount of manufacturing overhead allocated to jobs.
Given information:
Direct manufacturing labor cost is $348,000.
Overhead rate is $16.
Labor wage rate is $12.
3.
To compute: The total cost of completed jobs.
Given information:
The direct material cost is $234,000.
The direct labor cost is $348,000.
The manufacturing overhead cost is $464,000.
4.
The balance of work in process inventory on December 31, 2014.
Given information:
Opening work in process (WIP) inventory is $44,000.
Total cost of job is $1,046,000.
Finished goods are $925,000.
5.
The cost of goods sold before proration of under or over allocated overhead.
6.
To compute: The amount of under or over allocated manufacturing overhead.
Given information:
The actual manufacturing overhead is $514,000.
The manufacturing overhead allocated is $464,000.
7.a
Dispose off under allocated manufacturing overhead by (a) write off cost of goods sold (b) proration based on ending balance.
8.
To compute: The net operating income for 2017.
9.
To explain: The method applied by company to dispose the under allocated manufacturing overhead among the above two options.

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Chapter 4 Solutions
Cost Accounting, Student Value Edition Plus MyAccountingLab with Pearson eText -- Access Card Package (15th Edition)
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