Calculatng the Predetermined Overhead Rate
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Please help with the following problem. Provide the answers in Excel.
Granite Company uses a job order cost system. The company applies manufacturing overhead to jobs using a predetermined overhead rate based on direct labour hours. Last year, manufacturing overhead and direct labour hours were estimated at $80,000 and 16,000 hours respectively, for the year. In June, job #315 was completed. Materials costs on the job totaled $1,500 and labour costs totaled $2,400 at $6 per hour. At the end of the year, it was determined that the company worked 15,000 direct labour hours for the year, and incurred $78,000 in actual manufacturing overhead costs.
Required:
a. Determine the predetermined overhead rate for the year.
b. Determine the amount of overhead charged to jobs during the year.
c. Determine the amount of under- or over applied overhead for the year.
d. Assuming that 100 units were completed, determine the unit product cost that would appear on the job cost sheet for Job #315.
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Solution Summary
This solution helps calculate predetermined overhead rate. The explanation is given in an Excel spreadsheet.
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