65) Hurt Manufacturing has two departments that produce a line of tables. The Machining Department allocates manufacturing overhead using machine hours as the allocation base while
the Finishing Department allocates manufacturing overhead using direct labor cost as the
allocation base. Data for June are shown below:
Machining Dept.
Finishing Dept.
Estimated annual manufacturing overhead costs
$180,000
$900,000
Estimated annual direct labor cost
$90,000
$450,000
Estimated annual machine hours
45,000
10,000
Actual manufacturing overhead costs for June
$8,000
$85,000
Actual direct labor cost for June
$4,000
$45,000
Actual machine hours for June
3,000
1,200
A) Determine the predetermined manufacturing overhead rate for the Machining Department.
B) Determine the predetermined manufacturing overhead rate for the Finishing Department.
C) Determine the balances of the manufacturing overhead accounts for each department as of June 31. Indicate whether the amounts represent over allocated or under allocated manufacturing overhead.
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