2. How much manufacturing overhead was applied to production during January? 3.

Question

2. How much manufacturing overhead was applied to production during January?

3. Calculate the overapplied or underapplied overhead for January.

4. Prepare a journal entry to close the balance calculated in requirement (3) into Cost of Goods Sold. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

5. Prepare a journal entry to prorate the balance calculated in requirement (3) among the Work-in-Process Inventory, Finished-Goods Inventory, and Cost of Goods Sold accounts. (Do not round intermediate calculations. If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Explanation / Answer

1 Company's Predetermined overhead rate: Budgeted manufacturing overhead / Budgeted machine hours 282000/47000 6 per machine hour 2 Manufacturing overhead was applied to production during january: A79    - 6000 (1000*6) N08   - 15000 (2500*6) P82   - 3000 (500*6) Total manufacturing overhead applied 24000 3 Under application of overhead 2000 (26000-24000) 4 Account tile and explanation Debit Credit Cost of goods sold 2000 Manufacturing overhead 2000 (To close underapplied overhead) 5 Account tile and explanation Debit Credit Work in process 250 Finished goods 1250 Cost of goods sold 500 Manufacturing overhead 2000 (To close underapplied overhead)

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