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allsm [11]
3 years ago
14

applied vs. actual manufacturing overhead davis manufacturing corporation applies manufacturing overhead on the basis of 150% of

direct labor cost. an analysis of the related accounts and job order cost sheet indicates that during the year total manufacturing overhead incurred was $472,500 and that at year-end work in process inventory, finished goods inventory, and cost of goods sold included $60,000, $30,000, and $210,000, respectively, of direct labor incurred during the current year. a. determine the under applied manufacturing overhead at year-end (assume it is significant).
Business
1 answer:
Mashcka [7]3 years ago
8 0

Answer:

Subapplication of    22,500

journal entry:

WIP                   4,500 debit

finished goods 2,250 debit

COGS               15,750 debit

    factory overhead               22,500 credit

Explanation:

Direct Labor cost during the year:

60,000 + 30,000 + 210,000 = 300,000 direct labor

<u></u>

<u>Applied overhead:</u>

cost driver x predetermined rate

300,000 x 150% = 450,000

Actual overhead:   472,500

Subapplication of    22,500

as this is a significant amount we must adjust the WIP  inventory, cost of goods sold and fnished goods inventory

to know the adjustment on each account we calcualte each account percentage:

300,000   -->   22,500

60,000 --> 60,000/300,000 x 22,500 = 4,500 endingWIP

30,000 --> 30,000/300,000 x 22,500  = 2,250 finished goods

210,000--> 210,000/300,000 x 22,500 = 15,750 COGS

we do the adjuting entry to increase overhead and transfer into each concept

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Serga [27]

Answer:

Explanation:

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5 0
3 years ago
The Country Music Hall of Fame is considering increasing admission prices to increase gross revenue. If the price of admission r
Kitty [74]

Answer:

1

Explanation:

Elasticity of demand measures the responsiveness of quantity demanded to changes in price.

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I hope my answer helps you

3 0
3 years ago
Equipment that was purchased for $900,000 has a current book value of $450,000. Assume a capital gains tax rate of 28%. Compute
natita [175]

Answer:

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Explanation:

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