Question

In December 2016. Custom Mig established its predetermined overhead rate for jobs produced during 2017 by using the following cost predictions overhead costs, $750,000, and direct materials costs, $500,000. At year-end 2017, the company's records show that actual overhead costs for the year are $773,800. Actual direct material cost had been assigned to jobs as follows $380,000 72.000 Jobs completed and sold Jobs in finished goods Inventory Jobs in work in process inventory Total actual direct materials cost $510,000 1. Determine the predetermined overhead rate for 2017 2&3. Enter the overhead costs incurred and the amounts applied during the year using the predetermined overhead rate and determine whether overhead is overapplied or underapplied 4. Prepare the adjusting entry to allocate any over- or underapplied overhead to Cost of Goods Sold Complete this question by entering your answers in the tabs below. Real Reg 2 and 3

Answer 1

Factory overhead T account

Actual overhead	773800	Applied overhead (510000*1.5)	765000
Balance	8800

Journal entry

No	Date	General journal	debit	Credit
1	Dec 31	Cost of goods sold	8800
		Factory overhead		8800