Luzadis Company makes furniture using the latest automated technology. The compa

Question

Luzadis Company makes furniture using the latest automated technology. The company uses a job-order costing system and applies manufacturing overhead cost to products on the basis of machine-hours. The following estimates were used in preparing the predetermined overhead rate at the beginning of the year: Machine-hours Fixed manufacturing overhead cost Variable manufacturing overhead per computer-hour 3.60 84,000 $1,278,000 During the year, a glut of furniture on the market resulted in cutting back production and a buildup of furniture in the company's warehouse. The company's cost records revealed the following actual cost and operating data for the year: Machine-hours Manufacturing overhead cost$997,000 50,000

Explanation / Answer

Event General Journal Debit Credit 1 Cost of goods sold $56,500 Manufacturing overhead $56,500

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