Rieb Inc. has provided the following data for the month of September. There were

Question

Rieb Inc. has provided the following data for the month of September. There were no beginning inventories; consequently, the direct materials, direct labor, and manufacturing overhead applied listed below are all for the current month.

Manufacturing overhead for the month was overapplied by $7,150.

The company allocates any underapplied or overapplied overhead among work in process, finished goods, and cost of goods sold at the end of the month on the basis of the overhead applied during the month in those accounts.

Required:

Provide the journal entry that would record the allocation of underapplied or overapplied among work in process, finished goods, and cost of goods sold. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Work In Process Finished Goods Cost of Goods Sold Total Direct materials $ 3,710 $ 8,790 $ 47,310 $ 59,810 Direct labor 9,870 24,120 130,050 164,040 Manufacturing overhead applied 6,280 10,990 61,230 78,500 Total $ 19,860 $ 43,900 $ 238,590 $ 302,350

Explanation / Answer

Journal entry for allocating the overapplied manufacturing overhead Date Account Title Debit Credit Manufacturing overhead 7150 Work in process 572 Finished goods 1001 Cost of goods sold 5577 Working: Total Work in Finished Cost of process goods goods sold Manufacturing overhead applied 78500 6280 10990 61230 Percentage 8.00% 14.00% 78.00% Allocation of manufacturing overhead overapplied 7150 572 1001 5577 Allocation is based on the percentage of the overhead applied to each head to the total overhead applied.

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