Exercise 3-9 Applying Overhead; T-accounts; Journal Entries [LO3-1, LO3-2, LO3-4
ID: 2335969 • Letter: E
Question
Exercise 3-9 Applying Overhead; T-accounts; Journal Entries [LO3-1, LO3-2, LO3-4] Harwood Company uses a job-order costing system that applies overhead cost to jobs on the basis of machine-hours. The company's predetermined overhead rate of $2.80 per machine-hour was based on a cost formula that estimates $282,800 of total manufacturing overhead for an estimated activity level of 101,000 machine-hours Required: 1. Assume that during the year the company works only 96,000 machine-hours and incurs the following costs in the Manufacturing Overhead and Work in Process accounts: Compute the amount of overhead cost that would be applied to Work in Process for the year and make the entry in your T-accounts. 2A. Compute the amount of underapplied or overapplied overhead for the year and show the balance in your Manufacturing Overhead T-account. 2B. Prepare a journal entry to close the company's underapplied or overapplied overhead to Cost of Goods Sold Complete this question by entering your answers in the tabs below Req 1 Req 2A Req 2B Compute the amount of overhead cost that would be applied to Work in Process for the year and make the entry in your T-accounts. Manufacturing Overhead 42,000 10,100 90,000 48,000 9,100 72,000 Work in Process 920,000 111,000 (Maintenance) (Indirect materials) (Indirect labor) (Utilities) (Insurance) (Depreciation) Balance (Direct materials) Direct labor) Overhead) (a) Req 1 Req 2A >Explanation / Answer
1) overhead applied predetermined overhead rate * actual machine hours 2.80*96,000 268800 Manufacturing overhead work in process Maintenance 42,000 268800 (a) Direct mat 920,000 indirect materials 10,100 direct labor 111,000 indirect labor 90,000 OH (a) 268800 utilities 48,000 insurance 9,100 Depreciation 72,000 Balance 2,400 2-a) under applied manufacturing overhead 2,400 2-b) Event General Journal Debit Credit 1) Cost of goods sold 2,400 Manufacturing overhead 2,400
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.