Compute the amount of underapplied or overapplied overhead cost for the year
Manufacturing overhead costs incurred:
Indirect materials
$1,100
Indirect labor
9,900
Property taxes, factory
2,800
Utilities, factory
4,900
Depreciation, factory
23,900
Insurance, factory
5,900
Total actual manufacturing overhead costs incurred
$48,500
Other costs incurred:
Purchases of raw materials(both direct and indirect)
$31,600
Direct labor cost
$40,600
Inventories:
Raw materials, beginning
$9,000
Raw materials, ending
$6,400
Work in process, beginning
$5,500
Work in process, ending
$6,900
--------------------------------------------------------------------------------
The company uses a predetermined overhead rate to apply overhead cost to production. The rate for the year was $5 per machine-hour. A total of 12,300 machine-hours was recorded for the year.