96) Beshaw Inc. has provided the following data for the month of January. There were no
beginning inventories; consequently, the direct materials, direct labor, and manufacturing
overhead applied listed below are all for the current month.
Work In
Process
Finished
Goods
Cost of Goods
Sold
Total
Direct materials
$
3,440
$
$
61,880
$
73,770
Direct labor
6,160
119,000
141,410
Manufacturing overhead
applied
3,300
45,650
55,000
Total
$
12,900
$
$
226,530
$
270,180
Manufacturing overhead for the month was underapplied by $7,000.
The Corporation allocates any underapplied or overapplied manufacturing overhead among work
in process, finished goods, and cost of goods sold at the end of the month on the basis of the
manufacturing overhead applied during the month in those accounts.
The cost of goods sold for January after allocation of any underapplied or overapplied
manufacturing overhead for the month is :
A) $233,530
B) $220,720
C) $232,340
D) $219,530
97) Crich Corporation uses direct labor-hours in its predetermined overhead rate. At the beginning
of the year, the estimated direct labor-hours were 21,800 hours and the total estimated
manufacturing overhead was $497,040. At the end of the year, actual direct labor-hours for the
year were 21,500 hours and the actual manufacturing overhead for the year was $492,040.
Overhead at the end of the year was:
A) $6,840 overapplied
B) $6,840 underapplied
C) $1,840 underapplied
D) $1,840 overapplied
98) Faughn Corporation has provided the following data concerning manufacturing overhead for
July:
Actual manufacturing overhead incurred
$
69,000
Manufacturing overhead applied to Work in Process
$
79,000
The company’s Cost of Goods Sold was $243,000 prior to closing out its Manufacturing Overhead
account. The company closes out its Manufacturing Overhead account to Cost of Goods Sold.
Which of the following statements is true?
A) Manufacturing overhead was underapplied by $10,000; Cost of Goods Sold after closing out
the Manufacturing Overhead account is $233,000
B) Manufacturing overhead was overapplied by $10,000; Cost of Goods Sold after closing out the
Manufacturing Overhead account is $233,000
C) Manufacturing overhead was overapplied by $10,000; Cost of Goods Sold after closing out the
Manufacturing Overhead account is $253,000
D) Manufacturing overhead was underapplied by $10,000; Cost of Goods Sold after closing out
the Manufacturing Overhead account is $253,000
Actual manufacturing overhead incurred
$
Manufacturing overhead applied to Work in Process
Underapplied (overapplied) manufacturing overhead
$
(10,000
)
99) Braam Corporation uses direct labor-hours in its predetermined overhead rate. At the
beginning of the year, the estimated direct labor-hours were 11,500 hours. At the end of the year,
actual direct labor-hours for the year were 9,700 hours, the actual manufacturing overhead for the
year was $143,350, and manufacturing overhead for the year was underapplied by $18,220. The
estimated manufacturing overhead at the beginning of the year used in the predetermined overhead
rate must have been:
A) $164,023
B) $125,130
C) $148,350
D) $138,350
100) At the beginning of the year, manufacturing overhead for the year was estimated to be
$670,700. At the end of the year, actual direct labor-hours for the year were 36,200 hours, the
actual manufacturing overhead for the year was $665,700, and manufacturing overhead for the
year was overapplied by $22,100. If the predetermined overhead rate is based on direct
labor-hours, then the estimated direct labor-hours at the beginning of the year used in the
predetermined overhead rate must have been:
A) 35,037 direct labor-hours
B) 35,300 direct labor-hours
C) 36,200 direct labor-hours
D) 33,874 direct labor-hours
101) Dukes Corporation used a predetermined overhead rate this year of $2 per direct labor-hour,
based on an estimate of 20,000 direct labor-hours to be worked during the year. Actual costs and
activity during the year were:
Actual manufacturing overhead cost incurred
$
38,000
Actual direct labor-hours worked
18,500
The overapplied or underapplied manufacturing for the year was:
A) $1,000 underapplied
B) $1,000 overapplied
C) $3,000 underapplied
D) $3,000 overapplied
Actual manufacturing overhead incurred
$
Process:
Predetermined overhead rate (a)
$
labor-hour
Actual total amount of the allocation base (b)
labor-hours
Manufacturing overhead applied (a) × (b)
$
overhead
$
102) Bosshart Inc. has provided the following data for the month of May. There were no beginning
inventories; consequently, the direct materials, direct labor, and manufacturing overhead applied
listed below are all for the current month.
Work In
Process
Finished
Goods
Cost of Goods
Sold
Total
Direct materials
$
10,670
$
$
81,120
$
103,790
Direct labor
11,630
101,400
128,030
Manufacturing overhead
applied
9,680
68,640
88,000
Total
$
31,980
$
$
251,160
$
319,820
Manufacturing overhead for the month was underapplied by $6,000.
The Corporation allocates any underapplied or overapplied manufacturing overhead among work
in process, finished goods, and cost of goods sold at the end of the month on the basis of the
manufacturing overhead applied during the month in those accounts.
The journal entry to record the allocation of any underapplied or overapplied manufacturing
overhead for May would include the following:
A) credit to Work in Process of $31,980
B) credit to Work in Process of $660
C) debit to Work in Process of $31,980
D) debit to Work in Process of $660
Work in Process (11% × $6,000)
Finished Goods (11% × $6,000)
Cost of Goods Sold (78% × $6,000)
4,680
Manufacturing Overhead
103) Seuell Inc. has provided the following data for the month of December. There were no
beginning inventories; consequently, the direct materials, direct labor, and manufacturing
overhead applied listed below are all for the current month.
Work In
Process
Finished
Goods
Cost of Goods
Sold
Total
Direct materials
$
4,080
$
$
66,240
$
88,950
Direct labor
5,380
86,400
116,080
Manufacturing overhead
applied
3,780
45,990
63,000
Total
$
13,240
$
$
198,630
$
268,030
Manufacturing overhead for the month was overapplied by $12,000.
The Corporation allocates any underapplied or overapplied manufacturing overhead among work
in process, finished goods, and cost of goods sold at the end of the month on the basis of the
manufacturing overhead applied during the month in those accounts.
The journal entry to record the allocation of any underapplied or overapplied manufacturing
overhead for December would include the following:
A) debit to Finished Goods of $56,160
B) credit to Finished Goods of $56,160
C) debit to Finished Goods of $2,520
D) credit to Finished Goods of $2,520
Manufacturing Overhead
Work in Process (6% × $12,000)
Finished Goods (21% × $12,000)
Cost of Goods Sold (73% × $12,000)
104) Weatherhead Inc. has provided the following data for the month of March. There were no
beginning inventories; consequently, the direct materials, direct labor, and manufacturing
overhead applied listed below are all for the current month.
Work In
Process
Finished
Goods
Cost of Goods
Sold
Total
Direct materials
$
4,170
$
$
41,920
$
60,810
Direct labor
10,520
83,840
123,800
Manufacturing overhead
applied
5,830
34,980
53,000
Total
$
20,520
$
$
160,740
$
237,610
Manufacturing overhead for the month was overapplied by $3,000.
The Corporation allocates any underapplied or overapplied manufacturing overhead among work
in process, finished goods, and cost of goods sold at the end of the month on the basis of the
manufacturing overhead applied during the month in those accounts.
The work in process inventory at the end of March after allocation of any underapplied or
overapplied manufacturing overhead for the month is closest to:
A) $20,261
B) $20,779
C) $20,850
D) $20,190
105) Chipata Corporation applies manufacturing overhead to jobs on the basis of machine-hours.
Chipata estimated 25,000 machine-hours and $10,000 of manufacturing overhead cost for the
year. During the year, Chipata incurred 26,200 machine-hours and $11,300 of manufacturing
overhead. What was Chipata’s underapplied or overapplied overhead for the year?
A) $480 overapplied
B) $820 underapplied
C) $1,300 overapplied
D) $1,300 underapplied
106) Daget Corporation uses direct labor-hours in its predetermined overhead rate. At the
beginning of the year, the total estimated manufacturing overhead was $364,140. At the end of the
year, actual direct labor-hours for the year were 24,000 hours, manufacturing overhead for the year
was overapplied by $8,060, and the actual manufacturing overhead was $359,140. The
predetermined overhead rate for the year must have been closest to:
A) $15.43 per direct labor-hour
B) $15.30 per direct labor-hour
C) $15.17 per direct labor-hour
D) $14.96 per direct labor-hour
107) Pine Publishing Corporation uses a predetermined overhead rate based on direct labor-hours
to apply manufacturing overhead to jobs. At the beginning of the year the Corporation estimated
its total manufacturing overhead cost at $500,000 and its direct labor-hours at 125,000 hours. The
actual overhead cost incurred during the year was $450,000 and the actual direct labor-hours
incurred on jobs during the year was 115,000 hours. The manufacturing overhead for the year
would be:
A) $10,000 underapplied
B) $10,000 overapplied
C) $50,000 underapplied
D) $50,000 overapplied
108) Bayest Manufacturing Corporation uses a predetermined overhead rate based on direct
labor-hours to apply manufacturing overhead to jobs. Last year, the Corporation worked 56,000
actual direct labor-hours and incurred $352,000 of actual manufacturing overhead cost. The
Corporation had estimated that it would work 60,000 direct labor-hours during the year and incur
$330,000 of manufacturing overhead cost. The Corporation’s manufacturing overhead cost for the
year was:
A) overapplied by $44,000
B) underapplied by $44,000
C) overapplied by $22,000
D) underapplied by $22,000
109) Fils Inc. has provided the following data for the month of March. There were no beginning
inventories; consequently, the direct materials, direct labor, and manufacturing overhead applied
listed below are all for the current month.
Work In
Process
Finished
Goods
Cost of Goods
Sold
Total
Direct materials
$
4,080
$
$
59,940
$
76,800
Direct labor
2,110
53,280
66,750
Manufacturing overhead
applied
2,820
36,190
47,000
Total
$
9,010
$
$
149,410
$
190,550
Manufacturing overhead for the month was underapplied by $4,000.
The Corporation allocates any underapplied or overapplied manufacturing overhead among work
in process, finished goods, and cost of goods sold at the end of the month on the basis of the
manufacturing overhead applied during the month in those accounts.
The journal entry to record the allocation of any underapplied or overapplied manufacturing
overhead for March would include the following:
A) debit to Cost of Goods Sold of $3,080
B) debit to Cost of Goods Sold of $149,410
C) credit to Cost of Goods Sold of $3,080
D) credit to Cost of Goods Sold of $149,410
Work in Process (6% × $4,000)
$
Finished Goods (17% × $4,000)
$
Cost of Goods Sold (77% × $4,000)
$
3,080
Manufacturing Overhead
$
4,000
110) Karvel Corporation uses a predetermined overhead rate based on machine-hours to apply
manufacturing overhead to jobs. For the month of August, Karvel estimated total manufacturing
overhead costs at $300,000 and total machine-hours at 75,000 hours. Actual results for the period
were manufacturing overhead costs of $290,000 and 75,000 machine-hours. As a result, Karvel
would have:
A) applied more overhead to Work in Process than the actual amount of overhead cost for the year.
B) applied less overhead to Work in Process than the actual amount of overhead cost for the year.
C) applied an amount of overhead to Work in Process that was equal to the actual amount of
overhead.
D) found it necessary to recalculate the predetermined overhead rate.
111) Matthias Corporation has provided data concerning the Corporation’s Manufacturing
Overhead account for the month of May. Prior to the closing of the overapplied or underapplied
balance to Cost of Goods Sold, the total of the debits to the Manufacturing Overhead account was
$53,000 and the total of the credits to the account was $69,000. Which of the following statements
is true?
A) Manufacturing overhead applied to Work in Process for the month was $69,000.
B) Manufacturing overhead for the month was underapplied by $16,000.
C) Manufacturing overhead transferred from Finished Goods to Cost of Goods Sold during the
month was $53,000.
D) Actual manufacturing overhead incurred during the month was $69,000.
112) Darrow Corporation uses a predetermined overhead rate based on direct labor-hours to apply
manufacturing overhead to jobs. Last year, the Corporation worked 10,000 direct labor-hours and
incurred $80,000 of actual manufacturing overhead cost. If overhead was underapplied by $2,000,
the predetermined overhead rate for the Corporation for the year must have been:
A) $7.80 per direct labor-hour
B) $8.00 per direct labor-hour
C) $8.20 per direct labor-hour
D) $8.40 per direct labor-hour
113) Forbes Corporation uses a predetermined overhead rate based on direct labor-hours to apply
manufacturing overhead to jobs. At the beginning of the period, the Corporation estimated
manufacturing overhead would be $18,000 and direct labor-hours would be 15,000. The actual
figures were $19,500 for manufacturing overhead and 16,000 direct labor-hours. The cost records
for the period will show:
A) overapplied manufacturing overhead of $300
B) overapplied manufacturing overhead of $1,500
C) underapplied manufacturing overhead of $1,500
D) underapplied manufacturing overhead of $300
114) Rist Corporation uses a predetermined overhead rate based on machine-hours to apply
manufacturing overhead to jobs. The Corporation estimated that it would incur $255,000 in
manufacturing overhead during the year and that it would work 100,000 machine-hours. The
Corporation actually worked 105,000 machine-hours and incurred $270,000 in manufacturing
overhead costs. By how much was manufacturing overhead underapplied or overapplied for the
year?
A) $15,000 overapplied
B) $15,000 underapplied
C) $2,250 overapplied
D) $2,250 underapplied
115) The actual manufacturing overhead incurred at Gutekunst Corporation during March was
$53,000, while the manufacturing overhead applied to Work in Process was $73,000. The
Corporation’s Cost of Goods Sold was $451,000 prior to closing out its Manufacturing Overhead
account. The Corporation closes out its Manufacturing Overhead account to Cost of Goods Sold.
Which of the following statements is true?
A) Manufacturing overhead was overapplied by $20,000; Cost of Goods Sold after closing out the
Manufacturing Overhead account is $471,000
B) Manufacturing overhead was underapplied by $20,000; Cost of Goods Sold after closing out
the Manufacturing Overhead account is $431,000
C) Manufacturing overhead was overapplied by $20,000; Cost of Goods Sold after closing out the
Manufacturing Overhead account is $431,000
D) Manufacturing overhead was underapplied by $20,000; Cost of Goods Sold after closing out
the Manufacturing Overhead account is $471,000