JOB ORDER COST ACCOUNTING The facory overhead activity base for this company is
ID: 2333691 • Letter: J
Question
JOB ORDER COST ACCOUNTING The facory overhead activity base for this company is based on direct labor costs. current year the estimates are as follows: For the 1) Estimated total factory overhead-$ 1,305,000 Estimated total direct labor costs 870,000 What is the predetermined factory overhead rate? Prepare the journal entries for the activity of a manufacturing company as presented below. Please include explanations, you may omit the dates. 2) a. Bought raw materials inventory on account $872,500 230,075 $ 90,200 S 174,300 b. Materials requisitioned during the month: Job 136 Job 137 Job 138 Total direct materials Indirect materials Total materials used $ 494,575 518,875 Debit c. Total dollar amount of time tickets for the month: Job 136 Job 137 Job 138 Total direct labor Indirect labor Total factory labor $ 18,250 S 22,500 30,000 70,750 S 56,000 126,750 Debi d. Incurred the following overhead costs during the month: Depreciation on factory building $ 5,500Explanation / Answer
1. Predetermined factory overhead rate = Estimated total factory overhead/ Estimated total direct labor costs
= $1305000/ $870000 = $1.50
2. Journal
3.
Job#136
Job#137
Job#138
4.
Journal
5.
6. Gross profit from Job#136 = $119300
7. Balance of Work in process = $494575 + 70750 + 106125 - 525000 = $146450
Balance of Factory overhead = $24300 + 56000 + 19625 - 106125 = $-6200 over applied
8. Journal
10. Factory overhead was overapplied by $6200.
11. The gross profit will increase.
No. Account titles and explantion Debit Credit a. Raw material inventory $872500 Accounts payable $872500 (To record material purchased on account) b. Work in progress inventory 494575 Factory overhead 24300 Raw material inventory 518875 (To record materials requisitioned during the month) c. Work in progress inventory 70750 Factory overhead 56000 Factory payroll 126750 (To record dollar amount of time tickets during the month) d. Factory overhead (5500+6250+7875) 19625 Property taxes 5750 Accumulated depreciation 5500 Accounts payable (7875+5750) 13625 Cash 6250 (To record overhead expenses) e. Work in progress inventory ($70750 x $1.50) 106125 Factory overhead 106125 (To record allocation of factory overheads)Related Questions
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