Question

Compute the budgeted manufacturing overhead rate.

2.

Prepare the summary journal entry to record the allocation of manufacturing overhead.

3.

Compute the amount of​ under- or overallocated manufacturing overhead. Is the amount significant enough to warrant proration of overhead​ costs, or should

Original

Woodworking write it off to cost of goods​ sold? Prepare the journal entry to dispose of the​ under- or overallocated overhead.

Budgeted manufacturing overhead costs	$4,800,000
Budgeted direct labor-hours	240,000
Actual manufacturing overhead costs	$4,909,000
Actual direct labor-hours	246,000

Answer 1

F Credit $4.920,000 A B с D E 1 1 Budgeted manufacturing Budgeted quantity of 2 overhead costs cost-allocation base = Overhead rate $4,800,000/ 240.000 = $20 4 5 2 6 Journal Entry 7 Accounts Debit 8 Work-in-Process Control $4,920,000 9 Manufacturing Overhead Control 10 (To record the allocation of manufacturing overhead) 11 12 3 13 Actual overheads $4,909,000 14 Applied overheads $4,920,000 15 Overallocated overheads $11,000 16 17 Journal Entry 18 Accounts Debit 19 Manufacturing Overhead Control $11,000 20 Cost of goods sold 21 (To record overallocated overheads disposed) Credit $11,000 Calculations are shown below: D E F = Overhead rate = =A3/C3 Credit Debit =246000*E3 =E8 A B с 1 1 Budgeted manufacturing Budgeted quantity of 2 overhead costs 1 cost-allocation base 3 4800000 / 240000 4 5 2 6 Journal Entry 7 Accounts 8 Work-in-Process Control 9 Manufacturing Overhead Control 10 (To record the allocation of manufacturing overhead) 11 12 3 13 Actual overheads 4909000 14 Applied overheads =F9 15 Overallocated overheads =C14-C13 16 17 Journal Entry 18 Accounts 19 Manufacturing Overhead Control 20 Cost of goods sold 21 (To record overallocated overheads disposed) Credit Debit =C15 =E19