Exercise 3-8 Applying Overhead; Journal Entries; Disposing of Underapplied or Overapplied Overhead [LO3-1, LO3-2, LO3-4]
The following information is taken from the accounts of Latta Company. The entries in the T-accounts are summaries of the transactions that affected those accounts during the year.
Manufacturing Overhead | |||
(a) | 479,232 | (b) | 399,360 |
Bal. | 79,872 |
Work in Process | |||
Bal. | 13,640 | (c) | 742,000 |
288,000 | |||
89,000 | |||
(b) | 399,360 | ||
Bal. | 48,000 |
Finished Goods | |||
Bal. | 42,000 | (d) | 656,000 |
(c) | 742,000 | ||
Bal. | 128,000 |
Cost of Goods Sold | |||
(d) | 656,000 |
The overhead that had been applied to production during the year is distributed among Work in Process, Finished Goods, and Cost of Goods Sold as of the end of the year as follows:
Work in Process, ending | $ | 23,040 |
Finished Goods, ending | 61,440 | |
Cost of Goods Sold | 314,880 | |
Overhead applied | $ | 399,360 |
For example, of the $48,000 ending balance in work in process, $23,040 was overhead that had been applied during the year.
Required:
1. Identify reasons for entries (a) through (d).
2. Assume that the underapplied or overapplied overhead is closed to Cost of Goods Sold. Prepare the necessary journal entry.
3. Assume that the underapplied or overapplied overhead is closed proportionally to Work in Process, Finished Goods, and Cost of Goods Sold. Prepare the necessary journal entry.
1) | |||||||
(a) | Actual manufacturing cost for the year | ||||||
(b) | Manufacturing overhead applied to Work in process | ||||||
( c ) | Cost of goods manufactured for the year | ||||||
(d) | cost of goods sold for the year | ||||||
2) | Journal Entry | ||||||
General Journal | Debit | Credit | |||||
Cost of goods sold |
79872 |
||||||
Manufacturing overhead | 79872 | ||||||
3) | Work in process | (79872*23040)/399360 | 4608 | ||||
Finished goods | (79872*61440)/399360 | 12288 | |||||
cost of goods sold | (79872*314880)/399360 | 62976 | |||||
manufacturing overhead | 79872 | ||||||
Exercise 3-8 Applying Overhead; Journal Entries; Disposing of Underapplied or Overapplied Overhead [LO3-1, LO3-2, LO3-4] The...
Exercise 3-8 Applying Overhead; Journal Entries; Disposing of Underapplied or Overapplied Overhead [LO3-1, LO3-2, LO3-4] The following information is taken from the accounts of Latta Company. The entries in the T-accounts are summaries of the transactions that affected those accounts during the year. Manufacturing Overhead (a) 460,000 (b) 390,000 Bal. 70,000 Bal. Work in Process 15,000 (c) 710,000 260,000 85,000 390,000 40,000 Bal. (c) Bal. Finished Goods 50,000(d) 640,000 710,000 120,000 (b) Bal. Cost of Goods Sold 640,000 (d) The...
Exercise 3-8 (Algo) Applying Overhead; Journal Entries; Disposing of Underapplied or Overapplied Overhead [LO3-1, LO3-2, LO3-4] The following information is taken from the accounts of Latta Company. The entries in the T-accounts are summaries of the transactions that affected those accounts during the year. (a) Manufacturing Overhead 483,840 (6) 403,200 80,640 Bal. 750,000 660,000 Work in Process 11,800 (c) 295,000 90,000 403, 200 50,000 Finished Goods 40,000 (d) 750,000 130,000 Bal (c) Bal. Bal. (b) Bal. Cost of Goods Sold...
Exercise 3-8 Applying Overhead; Journal Entries; Disposing of Underapplied or Overapplied Overhead [LO3-1, LO3-2, LO3-4) The following information is taken from the accounts of Latta Company. The entries in the T-accounts are summaries of the transactions that affected those accounts during the year. (b) Manufacturing Overhead Work in Process Finished Goods (a) 460,000 (b) 390,000 Bal. 15,000 (c) 710,000 Bal. 50,000 (d) 640,000 Bal. 70,000 260,000 (c) 710,000 85,000 Bal. 120,000 390,000 Bal. 40,000 Cost of Goods Sold (d) 640,000...
Exercise 3-8 Applying Overhead; Journal Entries; Disposing of Underapplied or Overapplied Overhead LO3-1, LO3-2, LO3-4] The following information is taken from the accounts of Latta Company. The entries in the T-accounts are summaries of the transactions that affected those accounts during the year Manufacturing Overhead Work in Process Finished Goods 45,000 (d) 16,400 (c) 87,500 45,000 393,600 Bal. 730,000 Bal. 650,000 Bal. 78,720 277, 500 Bal. 125,000 (b Bal. 393,608 Cost of Goods Sold 650,000 The overhead that had been...
Heip Exercise 3-8 Applying Overhead; Journal Entries; Disposing of Underapplied or Overapplied Overhead [LO3-1, LO3-2, LO3-4] The following information is taken from the accounts of Latta Company. The entries in the T-accounts are summaries of the transactions that affected those accounts during the year. Manufacturing Overhead 481,536 (b) 80,256 Work in Process 12,720 (c) 291,500 89,500 401, 280 49,000 Finished Goods 41,000 (d) 746, e00 129, 000 (a) 401,280 Bal. Bal. (c) 746,000 658, 000 Bal. Bal. (b) Bal. Cost...
Exercise 3-8 Applying Overhead; Journal Entries; Disposing of Underapplied or Overapplied Overhead (LO3-1, LO3-2, LO3-4) The following information is taken from the accounts of Latta Company. The entries in the T-accounts are summaries of the transactions that affected those accounts during the year. points Manufacturing Overhead 495,360 (b) 412,800 82,560 (a) Bal. Bal. 778,880 670,000 Work in Process 7,200 (c) 312,500 92,500 412,800 55,000 Finished Goods 35,000 (d) 770,000 135,000 Bal. (c) Bal. eBook (b) Bal. Print Cost of Goods...
Exercise 3-8 Applying Overhead; Journal Entries; Disposing of Underapplied or Overapplied Overhead [LO3-1, LO3-2, LO3-4) The following information is taken from the accounts of Latta Company. The entries in the T-accounts are summaries of the transactions that affected those accounts during the year. Manufacturing Overhead 493,056 (b) 410,880 82,176 Bal. Bal. 668,000 Work in Process 8,120 (c) 766,000 309,000 92,000 410,880 54,000 Finished Goods 36,000 (d) 766,000 134,000 Bal. Bal. (b) Bal. Cost of Goods Sold 668,000 (d) The overhead...
4 Exercise 3-8 Applying Overhead; Journal Entries; Disposing of Underapplied or Overapplied Overhead [LO3-1, LO3-2, LO3-4) 2 points The following information is taken from the accounts of Latta Company. The entries in the T-accounts are summaries of the transactions that affected those accounts during the year. Manufacturing Overhead 499,968 (b) 416,640 Bal. 83,328 Bal. eBook Work in Process 5,360(e) 778,000 319,500 93,500 416,640 57,000 Bal. (c) Bal. Finished Goods 33,000 (d) 674,000 778,000 137,000 (b) Bal. Print (d) ) Cost...
Exercise 3-8 Applying Overhead; Journal Entries; Disposing of Underapplied or Overapplied Overhead [L03-1, LO3-2, LO3-4) The following information is taken from the accounts of Latta Company. The entries in the T-accounts are summaries of the transactions that affected those accounts during the year. Manufacturing Overhead Work in Process Finished Goods (a) 499,968 (b) 416,640 Bal. 5,36 (c) 778,000 Bal. 33,000 (d) 674,000 Bal. 83,328 319,500 (c) 778,000 93,500 Bal. 137,000 (b) 416,640 Bal. 57,000 Cost of Goods Sold 674,000 The...
The following information is taken from the accounts of Latta Company. The entries in the T-accounts are summaries of the transactions that affected those accounts during the year. Manufacturing Overhead Work in Process Finished Goods 479,232 b) 399,360 Bal 13.640 (e) 742,000 Bal. 42,000(d) 656,000 79,872 288.000 le) 742.000 89,000 Bal. 128,000 399,360 49,000 Cost of Goods Sold (d) 656,000 Bal. The overhead that had been applied to production during the year is distributed among Work in Process, Finished Goods,...