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.
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.