Question

need help solving e) f) and g) using the following information posted below

1) Write summary journal entries for Superior Company for the following transactions for the period as calculated/given in the problem on CONNECT. Use the Review Problem at the end of Chapter 2 on page 119 as a reference. a) Purchase of raw material Ruw 266.000 Accont payubie 266,000 b) Transfer of Raw material to Work-in-Process 367,000 CR c) Application of Direct Labor to Work-in-Process WIP 14.000 14,000 Factory muges PR CR d) Application of Manufacturing Overhead to Work-in-Process WIP 367.000 Mot applied to WIP DR e) Transfer of Work-in-Process to Finished Goods Finished goods 212.000 CR DR worku Places 700.000 f) Revenue for the sale of goods manufactured ACC Receivsle 1064,000 sales 1,064,000 CR BP g) Cost of goods sold COLS 6670w Finished Goods 667.000 PR CR h) The incurrence of the actual overhead costs (use " various” to represent multiple accounts) Molt Selling & administrative 351100 351.600 DR i) Clear the Overhead account. Accounts paygle CR Manufactory overveco 16.000 DR cost of goal solds 16,000 CR 1

Answer 1

Answer e, f & g only as required

Answer e

Manufacturing overheads applied using machine hours as a base = $364,965

Actual over heads incurred = $351,000

Since applied overheads are higher than actual overheads this means overheads were overapplied

Overapplied overheads = $364,965 - $351,000 =$13,965

Answer f

Since overheads were overapplied that means cost of goods sold is oversted, hence the same needs to be credited

Journal entry will be as follows

MOH clearing Account Dr...$13,965

Cost of goods sold......Cr.  $13,965

Answer g

The actual amount of overheads actually incurred is not impacted by the change is basis of allocating /applying the overheads. hence, the actual overheads incurred shall remain same at $351,000