Question

1. Predetermined Overhead Rate, Applied Overhead, Unit Cost

   Ripley, Inc., costs products using a normal costing system. The following data are available for last year:

   Budgeted:
   Overhead		$343,000
   Machine hours		88,000
   Direct labor hours		9,800
   Actual:
   Overhead		$342,200
   Machine hours		85,800
   Direct labor hours		9,580
   Prime cost		$1,464,700
   Number of units		180,000

   Overhead is applied on the basis of direct labor hours.

   Required:

   1. What was the predetermined overhead rate?
   $fill in the blank 1 per direct labor hour

   2. What was the applied overhead for last year?
   $fill in the blank 2

   3. Was overhead over- or underapplied, and by how much?
     = $fill in the blank 4

   4. What was the total cost per unit produced? (Carry your answer to four significant digits.)
   $fill in the blank 5 per unit

Answer 1