Question

Marcelino Co.'s March 31 inventory of raw materials is $84,000. Raw materials purchases in April are $520,000, and factory payroll cost in April is $382,000. Overhead costs incurred in April are: indirect materials, $54,000; indirect labor, $28,000; factory rent, $38,000; factory utilities, $20,000; and factory equipment depreciation, $60,000. The predetermined overhead rate is 50% of direct labor cost. Job 306 is sold for $670,000 cash in April. Costs of the three jobs worked on in April follow.

	Job 306				Job 307				Job 308
Balances on March 31
Direct materials		$	27,000			$	39,000
Direct labor			25,000				18,000
Applied overhead			12,500				9,000
Costs during April
Direct materials			131,000				220,000			$	110,000
Direct labor			102,000				151,000				101,000
Applied overhead			?				?				?
Status on April 30	Finished (sold)				Finished (unsold)					In process

Answer 1

Calculate predetermine overhead rate :

	Job 306	Job 307	Job 307
Balances on March 31
Direct materials	27000	39000
Direct labor	25000	18000
Applied overhead	12500	9000
Costs during April
Direct materials	131000	220000	110000
Direct labor	102000	151000	101000
Applied overhead	102000*50% = 51000	151000*50% = 75500	101000*50% = 50500
Total	348500	512500	261500
Status on April 30	Finished (sold)	Finished (unsold)	in process