Question

Job Costing Budgeted Manufacturing Overhead Rate, Allocated Manufacturing Overhead Taylor Company uses normal costing. It allocates manufacturing overhead costs using a budgeted rate per machine-hour. The following data are available for 2017: Budgeted manufacturing overhead costs $3,800,000 Budgeted machine-hours 200,000 Actual manufacturing overhead costs $3,660,000 Actual machine-hours 196,000 Use the blue shaded areas on the ENTERANSWERS tab for inputs. Always use cell references and formulas where appropriate to receive full credit. ​If you copy/paste from the Instructions tab you will be marked wrong. Requirements 1 Calculate the budgeted manufacturing overhead rate. 2 Calculate the manufacturing overhead allocated during 2017. 3 Calculate the amount of under- or overallocated manufacturing overhead. a. Enter your answer as a positive value.

Answer 1

1. Budgeted manufacturing overhead rate = Budgeted manufacturing overhead costs / Budgeted machine-hours

Budgeted manufacturing overhead rate = $3,800,000 / 200,000

Budgeted manufacturing overhead rate = $19

2. The manufacturing overhead allocated during 2017 = Actual machine-hours * Budgeted manufacturing overhead rate

Manufacturing overhead allocated = 196,000 * $19

Manufacturing overhead allocated =$3,724,000

3. Manufacturing overhead costs over-allocated = Manufacturing overhead allocated during 2017 - Actual manufacturing overhead costs

Manufacturing overhead costs over-allocated = $3,724,000 - $3,660,000

Manufacturing overhead costs over-allocated = $64,000