(L. OBJ. 3, 4) Allocating manufacturing overhead [10—15 min] Refer to the data in E1 6-...

(L. OBJ. 3, 4) Allocating manufacturing overhead [10—15 min]

Refer to the data in E1 6-20. Patel’s accountant found an error in her 2011 cost records. Depreciation on manufacturing property, plant, and equipment was actually $570,000, nor the $440,000 she originally reported. Unadjusted balances at the end of 2011 include:

Requirements

1. Use a T-account to determine whether manufacturing overhead is underallocated or overallocated, and by how much.

2. Record the entry to close out the underallocated or overallocated manufacturing overhead.

3. What is the adjusted ending balance of Cost of goods sold?