Answer:
<u>Part 1:</u>
a) We see that the actual Mfg OH is being debited with the amount incurred.
b) Work in Process Inventory Debit (b) 399,360
Mfg OH ( applied) Credit (b) 399,360
c) CGS debit (c) 742,000
WIP Credit (c) 742,000
d) CGS debit (d) 656,000
Finished Goods credit (d) 656,000
<u>Part 2</u>:
The journal entry is
Cost of Goods Sold $79872 Debit
Factory Overhead $ 79 872 Credit
<u>Part 3: </u>
Journal Entry
Work in Process, $ 24960 debit
Finished Goods, 66560 debit
Cost of Goods Sold (11648) credit
Manufacturing Overheads $ 79872 credit
Explanation:
The given accounts are
<h3><u>Manufacturing Overhead</u></h3>
Debit Credit
<u>(a) 479,232 (b) 399,360 </u>
<u>Bal. 79,872 </u>
<u />
<h3><u> Work in Process </u></h3>
Debit Credit
Bal. 13,640 (c) 742,000
288,000
89,000
<u>(b) 399,360 </u>
<u>Bal. 48,000 </u>
<h3><u>Finished Goods</u></h3>
Debit Credit
Bal. 42,000 (d) 656,000
<u>(c) 742,000 </u>
<u>Bal. 128,000 </u>
<u />
<h3><u>Cost of Goods Sold </u></h3>
(d) 656,000
<u>Part 1:</u>
a) Actual manufacturing overhead
We see that the actual Mfg OH is being debited with the amount incurred.
b) Manufacturing overhead applied to Work in Process Inventory
Work in Process Inventory Debit (b) 399,360
Mfg OH ( applied) Credit (b) 399,360
c) Cost of Goods Manufactured
CGS debit (c) 742,000
WIP Credit (c) 742,000
d) Cost of Goods Sold
CGS debit (d) 656,000
Finished Goods credit (d) 656,000
<u>Part 2: </u>
The actual overhead is $ 479232 and applied overhead is $399,360 which is less than actual overhead.
The journal entry is
Cost of Goods Sold $79872 Debit
Factory Overhead $ 79 872 Credit
To transfer under applied overhead to cost of goods sold.
<u>Part 3: </u>
We find the differences between actual and applied overheads and then pass the journal entry.
Work in Process, ending $ 23,040
Finished Goods, ending 61,440
<u>Cost of Goods Sold 314,880 </u>
<u>Overhead applied $ 399,360 </u>
Work in Process, ending $ 48,000
Finished Goods, ending 128,000
<u>Cost of Goods Sold 303,232 </u>
<u>Actual Overhead $ 479,232 </u>
Work in Process, ending =$ 48,000 -$ 23,040 =$ 24960
Finished Goods, ending= 128,000-61,440 = 66560
Cost of Goods Sold = 303,232 -314,880 = (11648)
<u><em>Journal Entry</em></u>
Work in Process, $ 24960 debit
Finished Goods, 66560 debit
Cost of Goods Sold (11648) credit
Manufacturing Overheads $ 79872 credit