Here is the problem.. I am not that good at accounting and I have no clue where to start. Any help would be appreciated. Thanks so much in advance! :)
Durham Company uses a job-order costing system. The following transactions took place last year:
a. Raw materials requisitioned for use in production, $46,000 (75% direct and 25% indirect).
b. Factory utility costs incurred, $15,200.
c. Depreciation recorded on plant and equipment, $29,200. Three-fourths of the depreciation relates to factory equipment, and the remainder relates to selling and administrative equipment.
d. Costs for salaries and wages were incurred as follows:
Direct labor $46,000
Indirect labor $18,600
Sales commissions $10,600
Administrative salaries $31,000 e. Insurance costs incurred, $4,200 (75% relates to factory operations, and 25% relates to selling and administrative activities).
f. Miscellaneous selling and administrative expenses incurred, $18,600.
g. Manufacturing overhead was applied to production. The company applies overhead on the basis of 140% of direct labor cost.
h. Goods that cost $136,000 to manufacture according to their job cost sheets were transferred to the finished goods warehouse.
i. Goods that had cost $126,000 to manufacture according to their job cost sheets were sold for $212,000.
Required::
1. Determine the underapplied or overapplied overhead for the year.
I know that it is OVERapplied... if that helps.