JOB-COSTING

Elliott Company uses a predetermined overhead rate based on machine-hours to apply manufacturing estimated activity level of 100,000 direct labor-hours. Actual overhead amounted to P325,000 with actual direc
overhead to jobs. The company manufactures tools to customer specifications. The following data labor-hours totaling 110,000 for the month. How much was the overapplied or underapplied overhead?
pertain to Job 1501: A. P25,000 overapplied
B. P25,000 underapplied
Direct labor-hours worked ................................................................ 300 C. P5,000 overapplied
Direct labor rate per hour .................................................................. P8.00 D. P5,000 underapplied
Direct materials used......................................................................... P4,200
Machine-hours used .......................................................................... 200 Heller Cannery, Inc., uses a predetermined overhead rate based on machine-hours to apply
Predetermined overhead rate per machine-hour ............................... P15.00 Manufacturing overhead to jobs. The company estimated that it would incur P510,000 in
manufacturing overhead during the year and that it would work 100,000 machine-hours.
What is the total manufacturing cost recorded on Job 1501? The company actually worked 105,000 machine-hours and incurred P540,000 in manufacturing
A) P8,800 overhead costs. By how much was manufacturing overhead underapplied or overapplied for the year?
B) P9,600 A) P4,500 overapplied
C) P10,300 B) P4,500 underapplied
D) P11,100 C) P30,000 overapplied
D) P30,000 underapplied

Job 910 was recently completed. The following data have been recorded on its job cost sheet: Woodman Company uses a predetermined overhead rate based on direct labor-hours to apply manufacturing
overhead to jobs. Estimated and actual data for direct labor and manufacturing overhead for last year are as
Direct materials ........................................ P3,193 follows:
Direct labor-hours ..................................... 21 labor-hours
Direct labor wage rate .............................. P12 per labor-hour Estimated Actual
Machine-hours .......................................... 166 machine-hours Direct labor-hours .................................................................... 600,000 550,000
The company applies manufacturing overhead on the basis of machine-hours. The predetermined overhead rate Manufacturing overhead .......................................................... P720,000 P680,000
is P15 per machine-hour. The total cost that would be recorded on the job cost sheet for Job 910 would be:
A) P3,220 ............ The manufacturing overhead for Woodman Company for last year was:
B) P3,760 A. overapplied by P20,000
C) P5,935 B. overapplied by P40,000
D) P3,445 C. underapplied by P20,000
D. underapplied by P40,000

The following data have been recorded for recently completed Job 450 on its job cost sheet. Direct materials Collins Company uses a predetermined overhead rate based on direct labor cost to apply
cost was P3,044. A total of 46 direct labor-hours and 104 machine-hours were worked on the job. The direct manufacturing overhead to jobs. The following information applies to the company for the current year:
labor wage rate is P15 per labor-hour. The company applies manufacturing overhead on the basis of machine-
hours. The predetermined overhead rate is P13 per machine-hour. The total cost for the job on its job cost sheet Direct labor-hours:
would be: Estimated for the year ........................................................... 24,000
A) P4,332 Actual hours worked ............................................................. 19,500
B) P3,734 Direct labor cost:
C) P3,072 Estimated for the year ........................................................... P300,000
D) P5,086 Actual cost incurred .............................................................. P210,000
Manufacturing overhead:
Avery Co. uses a predetermined overhead rate based on direct labor-hours to apply manufacturing overhead to Estimated for the year ........................................................... P240,000
jobs. For the month of October, Avery's estimated manufacturing overhead cost was P300,000 based on an Actual cost incurred .............................................................. P185,000

Cost Accounting and Controls 1

JOB-COSTING
The manufacturing overhead cost for the current year will be:
A. P17,000 overapplied Wayne applies manufacturing overhead cost to jobs based on direct labor-hours, and the
B. P17,000 underapplied predetermined rate is P5.75 per direct labor-hour. The company does not close underapplied
C. P55,000 overapplied or overapplied manufacturing overhead to Cost of Goods Sold until the end of the year.
D. P55,000 underapplied. What is the amount of cost of goods manufactured?
A) P508,750
At the beginning of the year, manufacturing overhead for the year was estimated to be P250,860. At the end of B) P502,000
the year, actual direct labor-hours for the year were 20,800 hours, the actual manufacturing overhead for the year C) P585,000
was P245,860, and manufacturing overhead for the year was underapplied by P10,820. If the predetermined D) P487,750
overhead rate is based on direct labor-hours, then the estimated direct labor-hours at the beginning of the year
used in the predetermined overhead rate must have been:
A. 22,200 direct labor-hours The following information relates to Zamudio Manufacturing Company:
B. 20,800 direct labor-hours
C. 21,758 direct labor-hours Total manufacturing overhead estimated for the year ....... P864,000
D. 22,715 direct labor-hours Predetermined overhead rate (based on direct labor-
hours) ............................................................................. P5.00 per DLH
Total direct labor-hours incurred during the year .............. 25,000 DLHs
Manufacturing overhead overapplied for the year ............. P4,600
Brabec Corporation uses direct labor-hours in its predetermined overhead rate. At the beginning of the year, the
estimated direct labor-hours were 19,700 hours. At the end of the year, actual direct labor-hours for the year were
17,700 hours, the actual manufacturing overhead for the year was P392,940, and manufacturing overhead for the How much manufacturing overhead cost did Zamudio actually incur?
year was underapplied by P35,400. The estimated manufacturing overhead at the beginning of the year used in A) P103,500
the predetermined overhead rate must have been: B) P119,600
A) P357,540 C) P120,400
B) P397,940 D) P129,600
C) P431,775
D) P387,940
Worley Company has underapplied overhead of P45,000 for the year ended December 31.
Before disposition of the underapplied overhead, selected December 31 data from
Wayne Company's beginning and ending inventories for the month of June were as follows: Worley's accounting records are as follows:

Sales P1,200,000
June 1 June 30 Cost of goods sold P720,000
Direct Materials.......................... P67,000 P62,000 Overhead applied during the year in ending inventories:
Work in Process ......................... P145,000 P171,000 Work in process P54,000
Finished Goods........................... P85,000 P78,000 Finished goods P90,000
Under Worley's cost accounting system, over- or underapplied overhead is allocated to
Production data for the month follow: ending inventories and cost of goods sold based on the amount of overhead applied during the
year in the ending balance of each account. In its income statement, Worley should report cost of
Direct labor cost incurred .................................................................. P200,000 goods sold of:
Direct labor-hours ............................................................................. 25,000 A) P682,500
Actual manufacturing overhead cost incurred .................................. P132,000 B) P684,000
Direct materials purchases ................................................................ P165,000 C) P756,000
D) P757,500

Cost Accounting and Controls 2