Dotsero Technology,Inc Job 243 Entered into Production on April 1 and Was

question 13

Essay

Dotsero Technology,Inc.,has a job-order costing system.The company uses predetermined overhead rates in applying manufacturing overhead cost to individual jobs.The predetermined overhead rate in Department A is based on machine hours,and the rate in Department B is based on direct materials cost.At the beginning of the most recent year,the company's management made the following estimates for the year:
$\begin{array}{|l|r|r|}\hline &{\text { Department }} \\\hline & \mathbf{A} & \mathbf{B} \\\hline \text { Machine-hours } & 70,000 & 19,000 \\\hline \text { Direct labour-hours } & 30,000 & 60,000 \\\hline \text { Direct materials cost } & \$ 195,000 & \$ 282,000 \\\hline \text { Direct labour cost } & \$ 260,000 & \$ 520,000 \\\hline \begin{array}{l}\text { Manufacturing overhead } \\\text { cost }\end{array} & \$ 420,000 & \$ 705,000 \\\hline\end{array}$
Job 243 entered into production on April 1 and was completed on May 12.The company's cost records show the following information about the job:
$\begin{array}{|l|r|r|}\hline & {\text { Department }} \\\hline & \mathbf{A} & \mathbf{B} \\\hline \text { Machine-hours } & 250 & 60 \\\hline \text { Direct labour-hours } & 70 & 120 \\\hline \text { Direct materials cost } & \$ 840 & \$ 1,100 \\\hline \text { Direct labour cost } & \$ 610 & \$ 880 \\\hline\end{array}$
At the end of the year,the records of Dotsero showed the following actual cost and operating data for all jobs worked on during the year:
$\begin{array}{|l|r|r|}\hline &{\text { Department }} \\\hline & \text { A } & \text { B } \\\hline \text { Machine-hours } & 61,000 & 20,000 \\\hline \text { Direct labour-hours } & 28,000 & 66,000 \\\hline \text { Direct materials cost } & \$ 156,000 & \$ 284,000 \\\hline \begin{array}{l}\text { Manufacturing overhead } \\\text { cost }\end{array} & \$ 385,000 & \$ 705,000 \\\hline\end{array}$
Required:
a.)Compute the predetermined overhead rates for Department A and Department B.
b.)Compute the total overhead cost applied to Job 243.
c.)Compute the amount of underapplied or overapplied overhead in each department at the end of the current year.

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Definitions:

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Policy principles and practices considered to be in the interests of the public or the community at large.

Fair Labor Standards Act

U.S. law that establishes minimum wage, overtime pay eligibility, recordkeeping, and child labor standards affecting full-time and part-time workers in the private sector and in federal, state, and local governments.

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Employment of children in any work that deprives them of their childhood, interferes with their ability to attend regular school, and that is mentally, physically, socially or morally harmful.