Question

The following information is available for Lock-Tite Company, which produces special-order security products and uses a jo costing system. April 30 May 31 Inventories Raw materials $44,000 10,400 64,000 54,000 21,700 37,600 Work in process Finished goods Activities and information for May Raw materials purchases (paid with cash) Factory payroll (paid with cash) Factory overhead 212,000 349,000 Indirect materials 17,000 82,000 122,000 1,420,000 Indirect labor Other overhead costs Sales (received in cash) Predetermined overhead rate based on direct labor cost 708 Determine whether there is over or underapplied overhead. Prepare the journal entry to allocate (close) overapplied or underapplied overhead to Cost of Goods Sold. Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Overhead General Absorption Journal Determine whether there is over or underapplied overhead. Factory Overhead Applied overhead Indirect labor 82,000 267,000 Other overhead costs 122,000 Underapplied overhead 63,000

Answer 1

Factory overhead

Actual overhead	221000	Applied overhead (267000*70%)	186900
Under applied overhead	34100

Adjusting entry

No	account and explanation	Debit	Credit
1	Cost of goods sold	34100
	Manufacturing overhead		34100