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horrorfan [7]
3 years ago
6

Diaz and Associates incurred the following costs in completing a tax return for a large company. Diaz applies overhead at 50% of

direct labor cost. LaborHours Used Hourly Rate Partner 5 $450 Senior manager 13 160 Staff accountants 100 70 1. Prepare journal entries to record direct labor and the overhead applied.
Business
1 answer:
muminat3 years ago
4 0

Answer:

Date                   Accounts Receivable                               Debit            Credit

XX-XX-XXXX    Work in Process                                    $11,330

                          Wages Payable                                                         $11,330

Date                   Accounts Receivable                               Debit            Credit

XX-XX-XXXX     Work in Process                                    $5,665

                           Manufacturing overhead                                            $5,665

<u>Working</u>

Total labor cost:

= Partner cost + Senior manager cost + Staff accountants

= (5 * 450) + (13 * 160) + (100 * 70)

= $11,330

Overhead is 50% of direct labor cost:

= 11,330 * 50%

= $5,665

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A company has established that the relationship between the sales price for one of its products and the quantity sold per month
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Q = 450

P = 35

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TR = P x Q = (75 - 0.1Q) x Q = -0.1Q2 + 75Q

Then, Cost = (30Q + 1,000)

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