At the beginning of the year, Tseng Company estimated the following: Overhead $834,000 Direct labor hours 60,000
Question:
At the beginning of the year, Tseng Company estimated the following:
Overhead $834,000
Direct labor hours 60,000
Tseng uses normal costing and applies overhead on the basis of direct labor hours. For the month of January, direct labor hours were 5,150. By the end of the year, Tseng showed the following actual amounts:
Overhead $805,000
Direct labor hours 58,000
Assume that unadjusted Cost of Goods Sold for Tseng was $2,840,000.
Required:
1. Calculate the predetermined overhead rate for Tseng.
2. Calculate the overhead applied to production in January.
3. Calculate the total applied overhead for the year. Was overhead over- or underapplied? By how much?
4. Calculate adjusted Cost of Goods Sold after adjusting for the overhead variance.
Step by Step Answer:
Managerial Accounting The Cornerstone Of Business Decision Making
ISBN: 9780357715345
8th Edition
Authors: Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger