385 Exam 1 . 200 points Fall 2014 Problem V-30 points The Carson Company had the

Question

385 Exam 1 . 200 points Fall 2014 Problem V-30 points The Carson Company had the operations. Estimated for the year was $350,000. . Estimated overhead for the year was $770,000; estimated direct labor cos a. Purchased materials on account, $567,00o. b. Requisitioned materials for production as follows: direct materials-85 percent of purchases, indirect materials 12 percent of purchases c. Direct labor for production is $331,000, indirect labor is $125,000 d. Overhead incurred (not including materials or labor): $529,000. e. Overhead is applied to production based on direct labor cost at the rate of_ percent Required: Part 1. What is the Predetermined Overhead Rate for the year? Part 2. Prepare the journal entries to record transactions a -e.

Explanation / Answer

a) Predetermine overhead rate = 770000*100/350000 = 220% of direct labour cost

b) Journal entry :

No Account title and explanation debit Credit Raw material inventory 567000 Account payable 567000 Work in process (567000*85%) 481950 Manufacturing overhead (567000*15%) 85050 Raw material inventory 567000 Work in process 331000 Manufacturing overhead 125000 Wages payable 456000 Manufacturing overhead 529000 Cash/payable 529000 Work in process (331000*220%) 728200 Manufacturing overhead 728200

Related Questions

Navigate

• Browse (All)
• Browse 3
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.