Peterson's Plastic Products Company Makes Rainwater Tanks and Applies Manufacturing

Essay

Peterson's Plastic Products Company makes rainwater tanks and applies manufacturing costs to production at a budgeted indirect-cost rate of $8 per direct labour-hour.The following data are obtained from the accounting records for June 2018:
$\begin{array}{ll}\text { Direct materials } & \$ 400000 \\\text { Direct labour (8000 hours @\$11/hour) } & \$ 88000 \\\text { Ind irect labour } & \$ 10000 \\\text { Plant facility rent } & \$ 50000 \\\text { Deprecia tion on plant machinery and equipment } & \$ 20000 \\\text { Sales commissions } & \$ 30000 \\\text { Administrative expenses } & \$ 40000\end{array}$
Required:
a.What actual amount of manufacturing overhead costs was incurred during June 2018?
b.What amount of manufacturing overhead was allocated to all jobs during June 2018?
c.For June 2018,was manufacturing overhead underallocated or overallocated? Explain.
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