Answer:
raw materials inventory 225,750
account payable 225,750
to record purchase of materials
WIP 217,600 debit
factory overhead 17,600 debit
raw materials 225,750 credir
to record use of materials
WIP 606,700 debit
factory overhead 72,300 debit
wages payable 680,000
to record wages for the period
factory overhead 330,000
selling expense 180,000
administrative expense 126,000
account payable 636,000
to record other expenses on account
factory overhead 27,500
selling expense 8, 100
adm expense 5, 250
prepaid expenses 40,850
to record expired prepaid
factory overhead 55,100
depreciation expense 61,300
acc depreciation factory equipmnet 55,100
acc depreciation office equipment 16,800
acc depreciation building 44,500
to record depreciation for the period
WIP 548,000
factory overhead 548,000
to record applied overhead
Finished Goods 1,140,000
WIP 1,140,000
to record jobs completed
COGS 1,128,000
Finished Goods 1,128,000
to record COGS
Factory Overhead 45,500 debit
COGS 45,500 credit
to record adjustment for overapplied factory overhead
Explanation:
For each entry we will make sure to make the difference between capitalized cost (factory overhead labor and materials) and cost for the period (selling and administrative expenses)
<u>Then we will do the adjustment for hte overhead </u>
adjustment for overhead:
actual overhead:
17,600 indirect materials
72,300 indirect labor
330,000 other expenses
27,500 expired prepaid
<u>55,100 depreciation equipment</u>
502,500 actual overhead
548,000 applied overhead
The actual cost were lower than expected, we charge more cost on the goods than we should, so we adjust and decrease the Cost of Goods Sold.
adjusment for overapplied overhead: 45,500
