Answer:
1.Work in process (end) = $52.
2.Journal entry to record disposing of overhead:
Dr Cost of goods sold 1000000
Cr Factory overhead 1000000
Explanation:
Predetermined rate = $31 per machine hour.
Actual machine hours = 3000000 hours.
Applied factory overhead = actual machine hours * predetermined rate
= 3000000 * 31 = $ 93000000.
Material used = material (open) + purchased - material (end)
152 = 18+154 - material( end)
Material (end) = 20.
Manufacturing cost = material used + direct labor + factory overhead
= 152+96+(19+34+28+13) = 341
Journal entry
1. Dr Material 154
Cr Accounts payable 154
(Material and supplies purchased on account)
2. Dr work in process 152
Cr Material 152
(Direct material used)
3.Dr Factory overhead 19
Cr material 19
( Indirect material issued)
4. Dr Work in process 96
Cr Payroll 96
(Direct labor used)
5. Dr Factory overhead 34
Cr payroll 34
( Indirect labor used)
6. Dr Factory overhead 28
Cr Accumulated depreciation 28
( Depreciation on plant)
7. Dr Factory overhead 13
Cr Accounts payable 13
( Various overhead incurred)
T-account
Work in process Material
Dr___________Cr__ __ DR ___________CR
(open) 9 -- 18 ----
152 154 --- 152
96 --- 19
Accounts payable Factory overhead
Dr____________Cr___ ___ DR ___________Cr
--- 154 19 ---
--- 13 34 ---
28 --
13 --
Payroll Accumulated deprec
Dr ____________Cr__ __ Dr _____________Cr
--- 96 --- 28
--- 34
Accounts payable Prepaid insurance
Dr_____________Cr___ Dr ___________Cr_
Cost of goods manufactured:
Cost of goods manufactured = manufacturing cost+ work in process (open)-work in process (end)
298 = 341 + 9 - work in process (end)
work in process (end) = 350 - 298 = $52.
Cost of goods sold:
Cost of goods sold = Finished goods (open) + cost of goods manufactured - finished goods (end)
294 = 10 +298 - finished goods (end)
Finished goods (end) = 308-294 = $14.
Over/under applied overhead:
Actual overhead = (19+34+28+13) = 94
Suppose overhead is in million so $ 94000000.
Applied overhead =<u>$ 93000000</u>
Under applied overhead = $1000000.
Adjusted cost of goods sold:
cost of goods sold = 294000
Add: under applied overhead = <u>1000000</u>
Adjusted cost of goods sold = 1294000
