5 Exercise 16-23 Recording overhead costs LO P3 Prepare journal entries to recor

Question

5 Exercise 16-23 Recording overhead costs LO P3 Prepare journal entries to record the following production activities 1. Paid overhead costs (other than indirect materials and indirect labor) of $21,000. points 2. Applied overhead at 90% of direct labor costs. Direct labor costs were $59,000. eBook View transaction list Hint Journal entry worksheet Print Record overhead costs paid. Note: Enter debits before credits ransaction General Journal Debit Credit Record entry Clear entry View general journal

Explanation / Answer

1. Manufacturing Overhead A/c - Debit - $21,000

   Cash A/c - Credit - $21,000

(Overhead cost paid $21,000)

2. Work-in-progress A/c - Debit 5,31,00 (59000 * 90%)

   Manufacturing overhead clearing A/c - Credit 5,31,00

(Overhead applied @ 90% of direct labour cost & debited to WIP a/c)

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