Use the following to answer questions
Sarasota Copy Company applies batch-related manufacturing overhead on the basis of the number of production runs. The following information is available:

-The amount of manufacturing overhead applied to Work-in-Process Inventory is:
A)$846,370
B)$829,250
C)$775,000
D)$745,000

Question

Use the following to answer questions 
Sarasota Copy Company applies batch-related manufacturing overhead on the basis of the number of production runs. The following information is available:
 
-The amount of manufacturing overhead applied to Work-in-Process Inventory is:
A)$846,370 
B)$829,250 
C)$775,000 
D)$745,000

Quizplus · Accepted Answer

To calculate the manufacturing overhead applied to WIP inventory, we need to calculate the predetermined overhead rate first.
Predetermined Overhead Rate = Estimated Total Manufacturing Overhead Cost / Estimated Total Number of Production Runs 
= $2,805,000 / 350 
= $8,014.29 per production run

Then, we can calculate the amount of manufacturing overhead applied to WIP inventory using the actual number of production runs and the predetermined overhead rate as follows: 
Manufacturing Overhead Applied = Predetermined Overhead Rate x Actual Number of Production Runs 
= $8,014.29 x 103 
= $ 826,750

Therefore, the correct answer is B.

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