ABC Inc. designs and makes the orthopedic mattress to the customer’s order and uses a job order

ABC Inc. designs and makes the orthopedic mattress to the customer's order and uses a job order system. The predetermined overhead rate for 2016 is 60% of direct labour cost. At the end of 2016 ABC Inc's direct labour cost totaled $170,000 and actual overhead amounted to $105,000.

A mattress made for an elderly customer Jacob required $32,000 of direct materials and $6,500 of direct labour it was completed in May 2016.

Required:

1a. Compute the total cost of Jacob mattress as shown on the job cost sheet at the date of completion.

1b. Compute the amount of under-or- overapplied manufacturing overhead for ABC Inc. for 2016.

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