Cavy Company estimates that total factory overhead costs will be $559,619 for th

Question

Cavy Company estimates that total factory overhead costs will be $559,619 for the year. Direct labor hours are estimated to be 90,700. Required: (a) Determine the: (1) Predetermined factory overhead rate (2) Amount of factory overhead applied to Job 567 if the amount of direct labor hours is 1,200 and Job 999 if the amount of direct labor hours is 3,100 (b) Prepare the journal entry to apply factory overhead for April according to the predetermined overhead rate. Refer to the Chart of Accounts for exact wording of account titles.

Explanation / Answer

(a) (1) Predetermined factory overhead rate = $559,619 / 90,700 = $6.17

(2) Job 567: 1,200 hrs * $6.17 = $7,404

Job 999: 3,100 hrs * $6.17 = $19,127

(b)

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