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ework A Saved Exercise 15-13 Adjusting factory overhead LO P4 The following information is available for Lock-Tite Company, w
Prepare the journal entry to allocate (close) overapplied or underapplied overhead to Cost of Goods Sold Complete this questi
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Answer #1
Factory OH
Indirect Materials $    33,000.00 WIP $ 212,250.00
Indirect Labor $    98,000.00 COGS $    56,750.00
Other OH costs $ 138,000.00
$ 269,000.00 $ 269,000.00
Under-applied OH = $    56,750.00
Entry
Particulars Debit Credit
COGS $ 56,750.00
To Factory OH $ 56,750.00

Workings:

(i) Total Labor Cost $ 381,000.00
(ii) Indirect Labor $   98,000.00
(i-ii) = (iii) Direct Labor $ 283,000.00
(iv) Predetermined OH rate 75%
(iii x iv) OH applied $ 212,250.00
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