Only need part c and d answered. Factory Overhead Rates, Entries, and Account Ba
ID: 2449654 • Letter: O
Question
Only need part c and d answered.
Factory Overhead Rates, Entries, and Account Balance
Hudson Company operates two factories. The company applies factory overhead to jobs on the basis of machine hours in Factory 1 and on the basis of direct labor hours in Factory 2. Estimated factory overhead costs, direct labor hours, and machine hours are as follows:
a. Determine the factory overhead rate for Factory 1.
$ per machine hour
b. Determine the factory overhead rate for Factory 2.
$ per direct labor hour
c. Journalize the entries to apply factory overhead to production in each factory for June.
d. Determine the balances of the factory overhead accounts for each factory as of June 30, and indicate whether the amounts represent overapplied factory overhead orunderapplied factory overhead.
Factory 1 Factory 2 Estimated factory overhead cost for fiscal year beginning June 1 $752,100 $600,300 Estimated direct labor hours for year 8,700 Estimated machine hours for year 16,350 Actual factory overhead costs for June $60,350 $51,670 Actual direct labor hours for June 780 Actual machine hours for June 1,280Explanation / Answer
Answer : C
Predetermined Over head rate for factory -1 = Estimated over head/Estimated Machine hour
= 752100/16350 = 46
Over head applied = Predetermined overhead rate * actual machine hour
= 46* 1280 = $ 58880
Predetermined Over head rate for factory -2 = Estimated over head/Estimated labour hour
= 600300/8700 = 69
Over head applied = Predetermined overhead rate * actual labour hour
= 69* 780 = $ 53820
Answer D : Incase of factory -1
Under applied factory over head = Applied Factory over head - actual over head
= 58880-60350
= 1470
Journal entry
Work in process debit 1470
To factory over head 1470
Incase of factory -2
Over applied factory over head = Applied Factory over head - actual over head
= 53820-51670
= 2150
Journal entry
factory over head debit 2150
To Work in process 2150
Factory work in Process (debit) Factory Over head (Credit) Factory 1 58880 58880 Factory-2 53820 53820Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.