Question

Check my work At the beginning of the year, Custom Mfg. established its predetermined overhead rate by using the following cost predictions: overhead costs, S640,000, and direct materials costs, $200,000. At year-end, the company's records show that actual overhead costs for the year are $1,590,400. Actual direct materials cost had been assigned to jobs as follows. Jobs completed and sold Jobs in finished goods Inventory Jobs in work in process inventory Total actual direct materials cost $370,000 75,000 49,000 $494,000 1. Determine the predetermined overhead rate. 283. Enter the overhead costs incurred and the amounts applied to jobs 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. Reg1 Reg 2 and 3 Reg 4 Determine the predetermined overhead rate. Overhead Rate

Answer 1

1.

Choose Numerator	/	Choose Denominator	=	Overhead rate
Estimated overhead costs	/	Estimated Direct material cost	=	Overhead rate
640000		200000		320%

2 & 3:

Factory Overhead
Actual overhead	1590400	1580800	Applied overhead
		9600	Underapplied Overhead
	1590400	1590400

4.

Date	General Journal	Debit	Credit
31-Dec	Cost of goods sold	9600
	Factory Overhead		9600