Case 03-62 Student Name:
Class:
Opticom, Inc.
Requirements 1 – 6
1. Explain why manufacturers use a predetermined overhead rate to
apply manufacturing overhead to their jobs.
2. Manufacturing overhead applied through November 30:
Machine hours
*
Predetermined overhead rate
*
Overhead applied
*
3. Manufacturing overhead applied in December:
Machine hours
*
Predetermined overhead rate
*
Overhead applied
*
4. Underapplied manufacturing overhead through December 31:
Actual overhead
*
Applied overhead
*
Underapplied overhead
*
5. Finished-Goods Inventory account on December 31:
November balance for Job No. N11-013
*
December direct material
*
December direct labor
*
December overhead
*
Total finished-goods inventory
*
Direct material:
Raw-material inventory, 1/1 *
Raw material purchases *
Raw material available for use *
Deduct: Indirect material used *
Raw-material inventory, 12/31 * *
For the Year Ended December 31
Opticom, Inc.
Schedule of Cost of Goods Manufactured
Raw material used *
Direct labor *
Manufacturing overhead:
Indirect material *
Indirect labor *
Utilities *
Depreciation *
Total actual manufacturing overhead *
Deduct: Underapplied overhead *
Overhead applied to work in process *
Total manufacturing costs *
Add: Work-in-process inventory, 1/1 *
Subtotal *
Deduct: Work-in-process inventory, 12/31* *
Cost of goods manufactured *
*Supporting calculations for work-in-process, 12/31
D12-002 D12-003 Total
Direct material
* * *
Direct labor
* * *
Applied overhead
* * *
Total
* * *
1
Case 03-62 Student Name:
Class:
Opticom Inc., Inc.
Requirements 1 – 6
1. Explain why manufacturers use a predetermined overhead rate to
apply manufacturing overhead to their jobs.
2. Manufacturing overhead applied through November 30:
Machine hours 73,000
3. Manufacturing overhead applied in December:
Machine hours 6,000
Direct material:
Raw-material inventory, 1/1 210,000$
Raw material purchases 2,126,000
Raw material available for use 2,336,000
Deduct: Indirect material used 268,000$
Raw material used 1,898,000$
Direct labor 1,850,000
Manufacturing overhead:
Indirect material 268,000$
Indirect labor 750,000
Utilities 534,000
Depreciation 840,000
Total actual manufacturing overhead 2,392,000
Deduct: Underapplied overhead 22,000
Overhead applied to work in process 2,370,000$
For the Year Ended December 31
Instructor
McGraw-Hill/Irwin
Manufacturers use predetermined overhead rates to allocate to production jobs the production costs that are not directly
Opticom, Inc.
Schedule of Cost of Goods Manufactured
*Supporting calculations for work-in-process, 12/31
D12-002 D12-003 Total
Direct material 75,800$ 52,000$ 127,800$