Delmar Ltd. manufactures industrial kitchen equipment. Delmar uses a normal job-costing system to allocate manufacturing overhead cost, based on the machine hours. The selected account balances are as follows:

The budgeted manufacturing overhead costs and machine hours were $126,000 and 5,600 hours. The actual machine hours worked was 6,200 hours.

REQUIRED

A. Calculate the budgeted overhead rate per machine hour and the actual overhead rate per machine hour?
B. What was the manufacturing overhead amount applied to the work-in-process? Was the amount over- or underapplied?
C. The material requisition records showed that $94,500 of materials was used in the production. What is the amount of material purchased?
D. Prepare all journal entries related to the production, including the year-end adjustment for over- or underapplied manufacturing overhead.
E. Prepare a schedule of cost of goods manufactured, using the amount of actual manufacturing overhead incurred. What is the amount of cost of goods sold after the adjustment?

Transcribed Image Text:

January 1 December 3 $72,000 $55,000 Direct materials Work-in-process 24,000 35,000 Finished goods 48,000 26,000 Direct manufacturing labour 124,000 Indirect manufacturing labour 50,000 Factory Insurance 8,000 Factory Utilities 30,000 Factory Maintenance 25,000 Depreciation-Machine 42,000