Far West Manufacturing Company operates a job-order costing system and applies overhead cost to jobs on...

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Far West Manufacturing Company operates a job-order costing system and applies overhead cost to jobs on the basis of direct material cost. Its predetermined overhead rate was based on a cost formula that estimated S500,000 of manufacturing overhead for an estimated allocation base of $390,625 direct material dollars. The company has provided the following data in the form of an Excel worksheet: Ending $55,000 166,125 138,000 The following actual costs were incurred during the year: $450,000 Beginning $38,000 79,000 47,000 Raw Materials Work in Process Finished Goods Purchase of raw materials Direct labor cost $119,000 Manufacturing overhead costs: Indirect materials Insurance, factory Depreciation of equipment Indirect labor Property taxes Maintenance Rent, building 104,875 102,000 35,000 32,700 41,000 23,425 49,000 Required: 1. Compute the predetermined overhead rate for the year. 2. Prepare a schedule of cost of goods manufactured for the year. 3. Compute the amount of underapplied or overapplied overhead for the year. 4. Prepare a schedule of cost of goods sold for the year. Adjust the underapplied or overapplied overhead to cost of goods sold. 5. Prepare all journal entries related to manufacturing overhead. Besides indirect materials, indirect labor and depreciation, all other costs are recorded as accounts payable. Far West Manufacturing Company operates a job-order costing system and applies overhead cost to jobs on the basis of direct material cost. Its predetermined overhead rate was based on a cost formula that estimated S500,000 of manufacturing overhead for an estimated allocation base of $390,625 direct material dollars. The company has provided the following data in the form of an Excel worksheet: Ending $55,000 166,125 138,000 The following actual costs were incurred during the year: $450,000 Beginning $38,000 79,000 47,000 Raw Materials Work in Process Finished Goods Purchase of raw materials Direct labor cost $119,000 Manufacturing overhead costs: Indirect materials Insurance, factory Depreciation of equipment Indirect labor Property taxes Maintenance Rent, building 104,875 102,000 35,000 32,700 41,000 23,425 49,000 Required: 1. Compute the predetermined overhead rate for the year. 2. Prepare a schedule of cost of goods manufactured for the year. 3. Compute the amount of underapplied or overapplied overhead for the year. 4. Prepare a schedule of cost of goods sold for the year. Adjust the underapplied or overapplied overhead to cost of goods sold. 5. Prepare all journal entries related to manufacturing overhead. Besides indirect materials, indirect labor and depreciation, all other costs are recorded as accounts payable.

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