Q-4SE - Horngren'S Financial And Managerial Accounting

Question

Computing manufacturing overhead 

Sunglasses Unlimited Company manufactures sunglasses. Following is a list of costs the company incurred during May. Use the list to calculate the total manufacturing overhead costs for the month.

 Glue for frames $ 250 

Depreciation on company cars used by sales force 4,000 

Plant depreciation 7,500 

Interest Expense 1,500 

Lenses 52,000 

Company president’s salary 24,500 

Plant foreman’s salary 3,500 

Plant janitor’s wages 1,300 

Oil for manufacturing equipment 150

Step-by-Step Solution

Answer

The total manufacturing overhead is $12,700

Definition of Manufacturing Overhead

The manufacturing overhead is defined as the indirect cost which cannot be easily traceable to any specific product.

Computation of manufacturing overhead

Sunglass Unlimited Company
Computation of total manufacturing overhead
Manufacturing Overhead	Amount ($)
Glues for frames	$250
Plant Depreciation	$7,500
Plant Foreman’s Salary	$3,500
Plant janitors’ salary	$1,300
Oil for manufacturing equipment	$150
Total manufacturing overhead	$12,700