Question

Give the entry to assign overhead to production for a given period, assuming that the overhead rate is 150 percent of direct labor cost and that $80,000 of direct labor cost was incurred in that period.

Answer 1

Answer:

                                       Dr.           Cr.

Work in process          120,000

Production overhead                 120,000

Explanation:

Given data:

Overheard rate = 150 percent

Direct labor cost = $80,000

Assigned Production overhead = Direct labor cost x Overheard rate

Assigned Production overhead = $80.000 x 150%

Assigned Production overhead = $80.000 x 1.50

Assigned Production overhead = $120.000