The chief cost accountant for Fizzy Fruit Beverage Co. estimated that total fact

Question

The chief cost accountant for Fizzy Fruit Beverage Co. estimated that total factory overhead cost for the Blending Department for the coming fiscal year beginning April 1 would be $147,000, and total direct labor costs would be $105,000. During April, the actual direct labor cost totaled $12,000, and factory overhead cost incurred totaled $17,050. What is the predetermined factory overhead rate based on direct labor cost? On April 30, journalize the entry to apply factory overhead to production. Refer to the Chart of Accounts for exact wording of account titles. What is the April 30 balance of the account Factory Overhead-Blending Department? Does the balance in part (c) represent over- or underapplied factory overhead? A. What is the predetermined factory overhead rate based on direct labor cost? B. On April 30, journalize the entry to apply factory overhead to production. Refer to the Chart of Accounts for exact wording of account titles. What is the April 30 balance of the account Factory Overhead-Blending Department?

Explanation / Answer

Answer 1

Predetermined factory overhead rate based on direct labor cost => 147000 / 105000

Predetermined factory overhead rate based on direct labor cost => $ 1.4

Answer 2

Work in process- Blending Department A/c Dr. (1.4 *12000) $16800

To Factory Overhead- Blending Department A/c Cr. $16800

Answer 3

April 30 balance of the account Factory Overhead-Blending Department => $ 250 Debit

Answer 4

Ovehead incurred $17050 - overhead applied 16800

$ 250 under applied   

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