Computation of Underapplied/ OverApplied Overhead | |
Actual Manufacturing Overhead cost (A) |
$850,000.00 |
Applied Manufacturing Cost (B) (60000Mhours X $12) |
$720,000.00 |
Under-applied manufacturing overhead (A-B) | $130,000.00 |
W/ No-1 Predetermined overhead rate = Total Manufacturing Overhead / Estimated Machine Hour = $900,000 / 75,000 = $12/ Machine Hour |
Computation of Underapplied/ OverApplied Overhead | |
Actual Manufacturing Overhead cost (A) |
$850,000.00 |
Applied Manufacturing Cost (B) (60000 Mhours X $12) |
$720,000.00 |
Under-applied manufacturing overhead (A-B) | $130,000.00 |
2. Journal Entry | ||
Account Tittle & Explanation | Debit | Credit |
Cost of goods sold | 130,000 | |
Manufacturing overhead | 130,000 | |
To Record booked Under applied Overhead |
Working Note Computation of Overhead Applied during the year |
||
Amount | Percent (%) | |
Work in process | 36,000 | 5% |
Finished goods | 180,000 | 25% |
Cost of goods sold | 504,000 | 70% |
Total | 720,000 | 100% |
part-3 Journal Entry | ||
Account Tittle & Explanation | Debit | Credit |
Work in process (5%*130,000) | 6,500 | |
Finished goods (25%*130,000) | 32,500 | |
Cost of goods sold (70%*15,000) | 91,000 | |
Manufacturing overhead | 130,000 |
Part-4 | |
Revised cost of Goods Sold ( if underapplied Closed to COGS (1400000+130000) | 1,530,000 |
Cost of goods sold (if the underapplied overhead is allocated among the accounts) (1400000 +91000) | 1,491,000 |
Net Income will be increased by | 39,000 |
Luzadis Company makes furniture using the latest automated technology. The company uses a job-order costing system...
Luzadis Company makes furniture using the latest automated technology. The company uses a job-order costing system and applies manufacturing overhead cost to products on the basis of machine-hours. The predetermined overhead rate was based on a cost formula that estimates $900,000 of total manufacturing overhead for an estimated activity level of 75,000 machine-hours. During the year, a large quantity of furniture on the market resulted in cutting back production and a buildup of furniture in the company's warehouse. The company's...
Luzadis Company makes furniture using the latest automated technology. The company uses a job-order costing system and applies manufacturing overhead cost to products on the basis of machine-hours. The predetermined overhead rate was based on a cost formula that estimates $900,000 of total manufacturing overhead for an estimated activity level of 75,000 machine-hours. During the year, a large quantity of furniture on the market resulted in cutting back production and a buildup of furniture in the company's warehouse. The company's...
Luzadis Company makes furniture using the latest automated technology. The company uses a job-order costing system and applies manufacturing overhead cost to products on the basis of machine-hours. The predetermined overhead rate was based on a cost formula that estimates $900,000 of total manufacturing overhead for an estimated activity level of 75,000 machine-hours. During the year, a large quantity of furniture on the market resulted in cutting back production and a buildup of furniture in the company’s warehouse. The company’s...
Luzadis Company makes furniture using the latest automated technology. The company uses a job-order costing system and applies manufacturing overhead cost to products on the basis of machine-hours. The predetermined overhead rate was based on a cost formula that estimates $900,000 of total manufacturing overhead for an estimated activity level of 75,000 machine-hours. During the year, a large quantity of furniture on the market resulted in cutting back production and a buildup of furniture in the company’s warehouse. The company’s...
Luzadis Company makes furniture using the latest automated technology. The company uses a job-order costing system and applies manufacturing overhead cost to products on the basis of machine-hours. The predetermined overhead rate was based on a cost formula that estimates $1,615,000 of total manufacturing overhead for an estimated activity level of 85,000 machine-hours. During the year, a large quantity of furniture on the market resulted in cutting back production and a buildup of furniture in the company's warehouse. The company's...
Luzadis Company makes furniture using the latest automated technology. The company uses a job-order costing system and applies manufacturing overhead cost to products on the basis of machine-hours. The predetermined overhead rate was based o a cost formula that estimates $651,000 of total manufacturing overhead for an estimated activity level of 93,000 machine-hours. During the year, a large quantity of furniture on the market resulted in cutting back production and a buildup of furniture in the company's warehouse. The company's...
Luzadis Company makes furniture using the latest automated technology. The company uses a job-order costing system and applies manufacturing overhead cost to products on the basis of machine-hours. The predetermined overhead rate was based on a cost formula that estimates $560,000 of total manufacturing overhead for an estimated activity level of 70,000 machine-hours. During the year, a large quantity of furniture on the market resulted in cutting back production and a buildup of furniture in the company's warehouse. The company's...
Luzadis Company makes furniture using the latest automated technology. The company uses a job-order costing system and applies manufacturing overhead cost to products on the basis of machine-hours. The predetermined overhead rate was based on a cost formula that estimates $560,000 of total manufacturing overhead for an estimated activity level of 70,000 machine-hours. During the year, a large quantity of furniture on the market resulted in cutting back production and a buildup of furniture in the company's warehouse. The company's...
Luzadis Company makes furniture using the latest automated technology. The company uses a job-order costing system and applies manufacturing overhead cost to products on the basis of machine-hours. The predetermined overhead rate was based on a cost formula that estimates $880,000 of total manufacturing overhead for an estimated activity level of 88,000 machine-hours. During the year, a large quantity of furniture on the market resulted in cutting back production and a buildup of furniture in the company's warehouse. The company's...
Luzadis Company makes furniture using the latest automated technology. The company uses a job-order costing system and applies manufacturing overhead cost to products on the basis of machine-hours. The predetermined overhead rate was based on a cost formula that estimates $765,000 of total manufacturing overhead for an estimated activity level of 85,000 machine-hours. During the year, a large quantity of furniture on the market resulted in cutting back production and a buildup of furniture in the company's warehouse. The company's...