FACTORY OVERHEAD

NAME: Jan Mark Castillo

COURSE AND YEAR: BSA 1

Problem 1: Factory Overhead Variance

1. Cost of Goods Sold 20,000
Factory Overhead 20,000

2. Cost of Goods Sold 10,000

Finished Goods 6,000
Work in Process 4,000
Factory Overhead 20,000

Problem 2: Predetermined Factory Overhead

1. Budgeted Factory Overhead 1,400,000
÷ Budgeted Direct labor hour 40,000
Factory overhead rate 35 per direct labor hour

2. Budgeted Factory Overhead 1,400,000

÷ Budget Machine hour 50,000
Factory overhead rate 28 per machine hour

3. Assembly
Budgeted Factory Overhead 1,000,000
÷ Budget Machine hour 35,000
Factory overhead rate 28.57 per machine hour

Finishing
Budgeted Factory Overhead 400,000
÷ Budgeted Direct labor hour 18,000
Factory overhead rate 22.22 per direct labor hour

Problem 3: Predetermined Factory Overhead

A. 1. Budgeted Factory Overhead 2,520,000
 ÷ Budgeted Direct labor cost 1,800,000
Factory overhead rate 1.4 per direct labor cost or 140% of direct
labor cost

2.Fabricating (8,400 x 1.4) 11,760

Machining (1,500 x 1.4) 2,100
Assembly (18,600 x 1.4) 26,040
Applied FOH 39,900

B. 3. Fabricating
Budgeted Factory Overhead 1,050,000
÷ Budgeted Direct labor cost 600,000
Factory overhead rate 1.75 per direct labor cost or 175% of
direct labor cost

Machining
Budgeted Factory Overhead 1,200,000
÷ Budgeted Direct labor cost 300,000
Factory overhead rate 4 per direct labor cost or 400% of direct
labor cost

Assembly
Budgeted Factory Overhead 270,000
÷ Budgeted Direct labor cost 900,000
Factory overhead rate 0.3 per direct labor cost or 30% of direct
labor cost

4. Fabricating (8,400 x 1.75) 14,700

Machining (1,500 x 4) 6,000
Assembly (18,600 x 0.3) 5,580
Applied FOH 26,280

C. 1. Plant Wide Rate

Actual FOH 2,592,000
Applied FOH (1.4 x 1,740,000) 2,436,000
Under-applied FOH 156,000

3. Departmental Rate
Actual FOH 2,592,000
 Applied FOH
(630,000 x 1.75) 1,102,500
(324,000 x 4) 1,296,000
(786,000 x 0.3) 235,800 2,634,300
Over-applied FOH 42,300

Problem 4: Predetermined Factory Overhead

1. Budgeted Factory Overhead 500,000
÷ Budgeted Direct labor hour 5,000
Factory overhead rate 100 per direct labor hour
x Direct labor hour per unit 3
Factory overhead rate per unit 300 per unit

2. Assembly
Budgeted Factory Overhead 325,000
÷ Budget Machine Hour 15,000
Factory overhead rate 21.67 per machine hour
x Machine hour per unit 10
Factory overhead rate per unit 216.70 per unit

Finishing
Budgeted Factory Overhead 175,000
÷ Budgeted Direct labor hour 2,000
Factory overhead rate 87.5 per direct labor hour
x Direct labor hour per unit 1
Factory overhead rate per unit 87.5 per unit

Problem 5: Predetermined Factory Overhead

1. Sewing Department
Budgeted Factory Overhead 1,204,000
÷ Budget Machine Hour 140,000
Factory overhead rate 8.6 per machine hour

Cutting Department
Budgeted Factory Overhead 1,470,000
÷ Budgeted Direct labor cost 840,000
Factory overhead rate 1.75 of direct labor cost
2. Sewing (220 x 8.6) 1,892
Cutting (1,360 x 1.75) 2,380
FOH Applied 4,272
3. Sewing
Direct Material 940
Direct Labor 580
Factory Overhead 1,892
Total Cost 3,412

Cutting
Direct Material 664
Direct Labor 1,360
Factory overhead 2,380
Total Cost 4,404

Total cost in sewing 3,412

Total cost in cutting 4,404
Total cost of Job 101 7,816

Total cost of Job 101 7,816

÷ No. of units 100
Unit cost 78.16 per unit

4. Sewing
Actual FOH 1,140,000
Applied FOH (8.6 x 130,000) 1,118,000
FOH Under-applied 22,000

Cutting
Actual FOH 1,500,000
Applied FOH (1.75 x 872,000) 1,526,000
FOH Over-applied 26,000