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98. What is Leija's cost of goods manufactured for March?
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99. What is Leija's work in process inventory balance at the end of March?
Lambson Inc. uses a job-order costing system in which any underapplied or overapplied
overhead is closed to cost of goods sold at the end of the month. In January the company
completed job Z65N that consisted of 26,000 units of one of the company's standard products.
No other jobs were in process during the month. The total manufacturing cost on job Z65N's job
cost sheet was $1,588,600. The manufacturing overhead for the month was underapplied by
$11,700. During the month, 15,000 completed units from job Z65N were sold. No other products
were sold during the month.
100. The unit product cost for job Z65N is closest to:
101. The cost of goods sold that would appear on the income statement for January, after
adjustment for any underapplied or overapplied overhead, is closest to:
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102. Babb Company is a manufacturing firm that uses job-order costing. The company's
inventory balances were as follows at the beginning and end of the year:
The company applies overhead to jobs using a predetermined overhead rate based on machine-
hours. At the beginning of the year, the company estimated that it would work 17,000 machine-
hours and incur $272,000 in manufacturing overhead cost. The following transactions were
recorded for the year:
• Raw materials were requisitioned for use in production, $412,000 ($376,000 direct and $36,000
indirect).
• The following employee costs were incurred: direct labor, $330,000; indirect labor, $69,000; and
administrative salaries, $157,000.
• Selling costs, $113,000.
• Factory utility costs, $29,000.
• Depreciation for the year was $121,000 of which $114,000 is related to factory operations and
$7,000 is related to selling, general, and administrative activities.
• Manufacturing overhead was applied to jobs. The actual level of activity for the year was 15,000
machine-hours.
• Sales for the year totaled $1,282,000.
Required:
a. Prepare a schedule of cost of goods manufactured in good form.
b. Was the overhead underapplied or overapplied? By how much?
c. Prepare an income statement for the year in good form. The company closes any underapplied
or overapplied overhead to Cost of Goods Sold.
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103. Sandler Corporation bases its predetermined overhead rate on the estimated machine-
hours for the upcoming year. Data for the upcoming year appear below:
Required:
Compute the company's predetermined overhead rate.
Estimated total manufacturing overhead = $838,770 + ($3.49 per machine-hour × 73,000
machine-hours) = $1,093,540 Predetermined overhead rate = $1,093,540 ÷ 73,000 machine-
hours = $14.98 per machine-hour
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104. Wahr Corporation bases its predetermined overhead rate on the estimated labor-hours
for the upcoming year. At the beginning of the most recently completed year, the company
estimated the labor-hours for the upcoming year at 32,000 labor-hours. The estimated variable
manufacturing overhead was $7.17 per labor-hour and the estimated total fixed manufacturing
overhead was $584,320. The actual labor-hours for the year turned out to be 33,300 labor-hours.
Required:
Compute the company's predetermined overhead rate for the recently completed year.
105. Escatel Corporation bases its predetermined overhead rate on the estimated labor-hours
for the upcoming year. Data for the most recently completed year appear below:
Required:
Compute the company's predetermined overhead rate for the recently completed year.
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106. Dobrinski Corporation bases its predetermined overhead rate on the estimated labor-
hours for the upcoming year. At the beginning of the most recently completed year, the company
estimated the labor-hours for the upcoming year at 13,000 labor-hours. The estimated variable
manufacturing overhead was $2.35 per labor-hour and the estimated total fixed manufacturing
overhead was $156,130.
Required:
Compute the company's predetermined overhead rate.
107. Job 599 was recently completed. The following data have been recorded on its job cost
sheet:
The company applies manufacturing overhead on the basis of direct labor-hours. The
predetermined overhead rate is $20 per direct labor-hour.
Required:
Compute the unit product cost that would appear on the job cost sheet for this job.
108. Job 434 was recently completed. The following data have been recorded on its job cost
sheet:
The company applies manufacturing overhead on the basis of machine-hours. The predetermined
overhead rate is $12 per machine-hour.
Required:
Compute the unit product cost that would appear on the job cost sheet for this job.
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109. The following cost data relate to the manufacturing activities of Newberry Company
during the just completed year:
The company uses a predetermined overhead rate to apply manufacturing overhead cost to
production. The predetermined overhead rate for the year was $15 per machine-hour. A total of
23,000 machine-hours was recorded for the year.
Required:
a. Compute the amount of underapplied or overapplied overhead cost for the year.
b. Prepare a Schedule of Cost of Goods Manufactured for the year.
110. Ceniceros Inc. uses a job-order costing system in which any underapplied or overapplied
overhead for the period is closed out to cost of goods sold. In October, the company completed
job Z53N that consisted of 20,000 units of one of the company's standard products. No other jobs
were in process during the month. The job cost sheet for job Z53N shows that the total cost for
the job was $1,232,000. During the month, the actual manufacturing overhead cost incurred was
$346,800 and the manufacturing overhead cost applied to job Z53N was $322,000. And during the
month, 15,000 completed units from job Z53N were sold. No other products were sold.
Required:
Determine the cost of goods sold that would appear on the income statement for October. Show
your work!
