Baab Corporation is a manufacturing fim that uses job-order costing. The company's inventory balances were as follows ot the beginning and end of the year - The company applies overhead to jobs using a predetermined overhead rate based on machine-hours. At the beginning of the year, the company estimated that it would work 33,750 machine-hours and incur 52.86 , 875 in manufacturing overhead cost. The following transactions were recorded for the year: - Raw materials were purchnsed, \$315,750. - Raw materials wore requisitioned for use in production, $307 , 750 (\$280,250 direct and $27 , 500 indirect). - The following employee costs were incuired: direct labor, $377 , 750 ; indirect laboc, 996,750 , and administrative solaries, $172750 . - Selling costs, $147350 . - Factory utility costs, $10 , 750 . - Depreciation for the year was $172 , 000 of which $158 , 000 is related to factory operations and $14 , 000 is related to seiling, general, and administrative activities. - Manufacturing overheed was applied to jobs. The actual level of activity for the year was 34,150 mochine-hours. - Sales for the year totaled \$1,305,000. Required: a. Prepare a schedule of cost of goods manufactured. b. Was the overheod underapplied or overapplied? By how much? c. Prepare an income statement for the yeat. The company closes any underapplied or overopplied overheod to Cost of Coods Sold. Complete this question by entering your answers in the table below. Prepare a schedule of cost of goods manufactured. Complete this question by entering your answers in the table below. Was the overhead underapplied or overapplied? By how much? Complete this question by entering your answers in the table below. Prepare an income statement for the year. The company closes any underapplied or overapplied overhead to Cost of Goods Sold.
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Baab Corporation is a manufacturing fim that uses job-order costing- T.docx
1. Baab Corporation is a manufacturing fim that uses job-order costing. The company's inventory
balances were as follows ot the beginning and end of the year - The company applies overhead to
jobs using a predetermined overhead rate based on machine-hours. At the beginning of the year,
the company estimated that it would work 33,750 machine-hours and incur 52.86 , 875 in
manufacturing overhead cost. The following transactions were recorded for the year: - Raw
materials were purchnsed, $315,750. - Raw materials wore requisitioned for use in production,
$307 , 750 ($280,250 direct and $27 , 500 indirect). - The following employee costs were
incuired: direct labor, $377 , 750 ; indirect laboc, 996,750 , and administrative solaries, $172750
. - Selling costs, $147350 . - Factory utility costs, $10 , 750 . - Depreciation for the year was
$172 , 000 of which $158 , 000 is related to factory operations and $14 , 000 is related to seiling,
general, and administrative activities. - Manufacturing overheed was applied to jobs. The actual
level of activity for the year was 34,150 mochine-hours. - Sales for the year totaled $1,305,000.
Required: a. Prepare a schedule of cost of goods manufactured. b. Was the overheod
underapplied or overapplied? By how much? c. Prepare an income statement for the yeat. The
company closes any underapplied or overopplied overheod to Cost of Coods Sold. Complete this
question by entering your answers in the table below. Prepare a schedule of cost of goods
manufactured. Complete this question by entering your answers in the table below. Was the
overhead underapplied or overapplied? By how much? Complete this question by entering your
answers in the table below. Prepare an income statement for the year. The company closes any
underapplied or overapplied overhead to Cost of Goods Sold.
