Question

LCD produces screens for use in various smartphones. The company reports the following information at December 31. LCD began operations on January 31 earlier that same year
Work in Process Wages Payable Manufacturing Finished Raw
Inventory Overhead Goods Inventory material
28,000 128,000 80,000 80,000 6,500 46,000 128,000 113,000 58,000 34,500
63,000 17,000
Balance
46,000 0 37,000
Requirement 1. What is the cost of direct materials used?
The cost of direct materials used is $ _ _ _
Requirement 2. What is the cost of indirect materials used?
The cost of indirect materials used is $ _ _ _
Requirement 3. What is the cost of direct labor?
The cost of direct labor is $ _ _ _
Requirement 4. What is the cost of indirect labor?
The cost of indirect labor is $ _ _ _
Requirement 5. What is the cost of goods manufactured?
The cost of goods manufactured is $ _ _ _
Requirement 6. What is the cost of goods sold (before adjusting for any under- or overallocated manufacturing overhead)?
Requirement 7. What is the actual manufacturing overhead?
The actual manufacturing overhead is $ _ _ _
Requirement 8. How much manufacturing overhead was allocated to jobs?
Allocated manufacturing overhead is $ _ _ _
Requirement 9. What is the predetermined manufacturing overhead rate as a percentage of direct labor cost?
Identify the formula and then compute the percentage. (Round your answer to the nearest whole percent.)
_ _ _ / _ _ _ = Predetermined overhead rate
_ _ _ / _ _ _ = _ _ _%
Requirement 10. Is manufacturing overhead underallocated or overallocated? By how much?
Identify the formula and then compute the underallocated or overallocated overhead. (Use parentheses or a minus sign for overallocated overhead.)

Answer 1

Answer:

Below are the original entry of the question in tabular format

Dr. Work in Process Cr.

28,000      |       128,000

63,000      |

46,000

Dr. Wages Payable Cr.

80,000  |   80,000

0

Dr. Manufacturing overhead Cr.

6,500     |      46,000

17,000    |

37,000

Dr. Finished Goods  Inventory Cr.  

128,000   |   113,000

Dr. Raw material Inventory Cr.  

58,000    |   34,500

1) The cost of direct materials used is $28,000      

2) The cost of indirect materials used is $6,500      

3) The cost of direct labor is $63,000      

4) The cost of indirect labor is $17,000      

5) The cost of goods manufactured is $128,000      

6) Cost of goods sold-unadjusted is $113,000      

7) The actual manufacturing overhead is $60,500      

8) Allocated manufacturing overhead to job is $46,000      

9) Predetermined manufacturing overhead rate = Manufacturing overhead / Direct labor cost  

=$46,000/$63,000

=0.7301

=73%

 

10) Actual manufacturing overhead - Allocated manufacturing overhead =

= $60,500 - $46,000

= $14,500

Manufacturing overhead is under allocated by $14,500