Question

The Carlin Fabrication Plant suffered a fire incident at the beginning of the​ year, which resulted in the loss of property including the accounting records. Some data for the year were​ retrieved, and extracts from it are shown​ below:Total manufacturing overhead costs estimated at the beginning of the year​$100,700Total direct labor costs estimated at the beginning of the year​$185,000Total direct labor hours estimated at the beginning of the year​3,000 direct labor hoursTotal machine hours estimated at the beginning of the year​9,600 machine hoursActual manufacturing overhead costs for the year​$96,900Actual direct labor costs for the year​$147,000Actual direct labor hours for the year​2,900 direct labor hoursActual machine hours for the year​10,000 machine hoursThe​ company's manufacturing overhead allocation is based on the number of machine hours. What is the amount of manufacturing overhead cost allocated to​ Work-in-Process Inventory during the​ year? (Round any intermediate calculations to two decimal​ places, and your final answer to the nearest​ dollar.)

Answer 1

Allocated overhead= $104,900

Step-by-step explanation:

Giving the following information:

The​ company's manufacturing overhead allocation is based on the number of machine-hours.

Total manufacturing overhead costs estimated at the beginning of the year ​$100,700. Total machine hours estimated at the beginning of the year​ 9,600 machine hours. Actual machine hours for the year​10,000 machine hours.

First, we need to calculate the estimated manufacturing overhead rate:

estimated manufacturing overhead rate= total estimated manufacturing overhead for the period/ total amount of allocation base

estimated manufacturing overhead rate= 100700/9600= $10.49 per machine-hour

Now, we can calculate the allocated manufacturing overhead.

Allocated overhead= estimated manufacturing overhead rate* actual machine-hours= 10.49* 10000= $104,900