Intermediate Managerial and Tax Accounting, Job Costing

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Intermediate Managerial and Tax
Accounting ACCTG 325-01, Fall 2024
Exercise 11
Chapter 4, Job Costing
Name _________________________________
RedID# _____________________________
1.
A small consulting firm has an overhead rate of 200% of direct labor charged to each job. The
materials cost (including travel and other direct costs) for a particular job is $10,000, and the direct labor
is $20,000. What is the total cost for this job?
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2. Nieto Machine Shop budgeted 4,000 labor hours and 8,000 machine hours used in May. Total
budgeted overhead in May is $80,000. What is the overhead rate using labor hours and also machine
hours? Which would you pick and why?
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3. If the overhead rate is $10 per machine hour and there are 20 labor hours, 16 machine hours, and two
personnel on the job, how much overhead should be applied to the job?
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4. Use the following information from BSJ Industries to determine the predetermined overhead rate
based on direct labor costs.
Direct labor hours
50,000
Average hourly pay rate $16.00
Manufacturing overhead $1,400,000
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5. Assume that the actual overhead is $613,000 in a given year, the overhead rate is $10 per unit,
60,000 units were sold, and 59,000 units were produced. For the end of the year, is overhead
underapplied or overapplied? By how much?
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