Predetermined Overhead Rate, Overapplied and Underapplied Overhead

Smith and Smith in an architectural firm. The company uses a job order costing system to apply

overhead costs to its jobs on the basis of direct labour hours. Before the year, the company

estimated its annual manufacturing overhead would be $$140,000$ and that its direct$-$labour

workforce would work a total of $3,500$ hours.

At the end of July, the company had no jobs in progress. The company began work on two jobs

in August $-$ information related to the jobs is below:

The Jones job was fully completed, and the company billed and collected $$75,000.$ The Brady

job had not been completed by the end of the month, and the client had not been billed.

Months later, actual overhead costs for the month were calculated to be: $$17,000.$

Required:

a$.)$ Compute the predetermined overhead rate.

b$.)$ Compute the total cost of each job.

c$.)$ How profitable was the Jones job?

d$.)$ By how much was overhead overapplied or underapplied?