Application of Overhead Assignment

4-45 Application of Overhead The following information is for Punta Company for July: a. Factory overhead costs were applied to jobs at a predetermined rate of $42.50 per labor hour. Job Sincurred 6,175 labor hours; Job T used 4,275 labor hours.

b. Job S was shipped to customers during July. c. Job T was still in process at the end of July. d. The overapplied or underapplied overhead to the Cost of Goods Sold account was closed at the end of July. e. Page 130 Factory utilities, factory depreciation, and factory insurance incurred are summarized as follows: Utilities Depreciation Insurance Total $14,250 45,000 18,000 $77,250 f. Direct materials and indirect materials used are as follows: Job S Job T Total Material A $28,500 $71,250 $99.750 Material B 12,000 35,000 47,000 Subtotal $40,500 $106,250 $146,750 Indirect materials 211,000 Total $357,750 g. Direct labor incurred for the two jobs and indirect labor is as follows: Jobs S55.500 Job T 45,000 Indirect labor 133,000 Total $233,500 Required 1. Calculate the total manufacturing cost for Job Sand Job T for July. 2. Calculate the amount of overapplied or underapplied overhead and state whether the Cost of Goods Sold account will be increased or decreased by the adjustment. .

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