Posted: July 6th, 2016

The company incurred the following overhead costs during the month??

Westin Watercrafts predetermined overhead rate for year 2011 is 200% of direct labor. Information on the company’s production activities during May 2011 are as follows.

a. Purchased raw materials on credit, $125,000.
b. Paid $84,000 cash for factory wages.
c. Paid $11,000 cash to a computer consultant to reprogram factory equipment.

d. Materials requisitions record use of the following materials for the month.
Job 136 $ 30,000
Job 137 20,000
Job 138 12,000
Job 139 14,000
Job 140 4,000

Total direct materials 80,000
Indirect materials 12,000
Total materials used $ 92,000

e. Time tickets record use of the following labor for the month.

Job 136 $ 8,000
Job 137 7,000
Job 138 25,000
Job 139 26,000
Job 140 2,000

Total direct labor 68,000
Indirect labor 16,000
Total $ 84,000

f. Applied overhead to Jobs 136, 138, and 139.
g. Transferred Jobs 136, 138, and 139 to Finished Goods.
h. Sold Jobs 136 and 138 on credit at a total price of $340,000.
i. The company incurred the following overhead costs during the month (credit Prepaid Insurance for expired factory insurance).