# (solution) Application of overhead. The following information applies to the O’ Donnell company

Problem 4-44 Application of overhead. The following information applies to the O’ Donnell company for March Production. (a) Purchased direct materials and Indirect materials with the following Summary of receiving reports: Material A Material B Indirect Materials Total \$16,000 12,000 3,000 \$31,000 (B) Issued direct materials and indirect materials with this summary of requisitions: Job X Material A Material B Subtotal Indirect materials Total Job Y Total \$8,000 \$16,000 \$24,000 3,000 8,000 \$11,000 \$11,000 \$24,000 \$35,000 39,000 \$74,000 ( C ) Factory labor incurred is summarized by these time tickets: Job X \$22,000 Job Y 15,000 Indirect labor 28,000 Total \$65,000 (D) Factor utilities, factor depreciateion, and factory insurance incurred is summarized as follows: Utilities Depreciation Insurance Total \$3,000 18,000 2,500 \$23,500 ( E ) Factory overhead costs were applied to jobs at the predetermined rate of \$46 per machine hour. Job X inc ( F) Job X was completed; Job Y was still in process at the end of March. The company closed the overapplied or Underapplied overhead to the Cost of Goods Sold account at the end o Required (1) Calculate the manufacturing cost for Job X and Job Y for March. (2) Calculate the amount of overapplied or underapplied overhead and state whether the cost Cost of Goods S y for March Production. There are only two jobs (X and Y) in production in March. eceiving reports: d as follows: r machine hour. Job X incurred 1,100 machine hours; Job Y used 800 machine hours. Sold account at the end of March. r the cost Cost of Goods Sold account will be increased or decreased by the adjustment.