The Allen Company has the following information for the Assembly Department for

Question

The Allen Company has the following information for the Assembly Department for the month of October:

Overhead rate is 200 percent of direct labor costs.

Allen Company uses a process costing system for the Assembly Department.
The journal entry to record goods completed and transferred out of the Assembly Department would include a

Materials purchased $ 45,000 Materials used 49,000 Direct labor 30,000 Actual manufacturing overhead 56,000 Cost of goods completed and transferred to the Finishing Dept. 125,000

Explanation / Answer

Answer will be a Debit to Work in Process-Finishing Department for $125,000

As entry would be

Work in process- Finishing Department Debit 125,000

Work in process- Assembly Department Credit 125,000

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