Question

Rocky Mountain Leatherworks, which manufactures saddles and other leather goods has three departments. The Assembly Department manufactures various leather products, such as belts, purses, and saddlebags, using an automated production process. The Saddle Department produces handmade saddles and uses very little machinery. The Tanning Department produces leather. The tanning process requires little in the way of labor or machinery, but it does require space and process time. Due to the different production processes in the three departments, the company uses three different cost drivers for the application of manufacturing overhead. The cost drivers and overhead rates are as follows: Predetermined Overhead Rate Department Cost Driver Square feet of leather $3 per square foot $7 per machine hour $5 per direct-labor hour Tanning Department Assembly Department Machine time Saddle Department Direct-labor time The company's deluxe saddle and accessory set consists of a handmade saddle, two saddlebags, a belt, and a vest, all coordinated to match. The entire set uses 110 square feet of leather from the Tanning Department, 2 machine hours in the Assembly Department, and 40 direct-labor hours in the Saddle Department. Required: Job number DS-25 consisted of 20 deluxe saddle and accessory sets. Prepare journal entries to record applied manufacturing overhead in the Work-in-Process Inventory account for each department. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Answer 1