Question

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The following information is taken from the accounts of Latta Company. The entries in the T-accounts are summaries of the transactions that affected those accounts during the year. Manufacturing Overhead Work in Process 377,000 409,000 Bal. (c) 761,800 105,600 210,600 Bal. 32,000 115,700 (b) 409,000 Bal. 79,100 Cost of Goods Sold Finished Goods Bal. 161,000 761,800 (d) 825,800 (d) 825,800 Bal. 97,000 The overhead that had been applied to production during the year is distributed among the ending balances in the accounts as follows: $ Work in process, ending Finished goods, ending Cost of goods Sold 24,540 49,080 335,380 Overhead applied $ 409,000 For example, of the $79,100 ending balance in work in process, $24,540 was overhead that had been applied during the year. Required: 1. Identify the reasons for entries (a) through (d). Reason Entry (a)

Answer 1

1. Reasons

1	Actual manufacturing overhead
2	Applied manufacturing overhead
3	Cost of goods manufactured
4	Cost of goods sold

2) Adjusting entry

transaction	General journal	Debit	Credit
1.	Manufacturing overhead	32000
	Cost of goods sold		32000
	(To record over applied overhead)