Question

Check my we Exercise 02-13 Adjusting factory overhead LO P4 148 points The following information is available for Lock-Tite Company, which produces special-order security products and uses a job order costing system April 30 May 31 $ $43,000 10.200 63.000 52.000 21.300 35,600 Inventories Raw materials Work in proces Finished goods Letivities and information for May Raw materiale purchases (paid with cash) Factory payroll (paid with cash) Factory Overhead Indirect materials Indirect labor Other overhead coate Sales received in cash) Predetermined overhead rate based on direct labor cost 210,000 345,000 15,000 80,000 120,000 1,400,000 Determine whether there is over or underapplied overhead. Prepare the journal entry to allocate (close) overapplied or underapplied overhead to Cost of Goods Sold. Complete this question by entering your answers in the tabs below. Overhead Absorption General Journal Determine whether there is over or underapplied overhead.

Answer 1

Solution: a) Over applied or under applied overhead Indirect materials Indirect labor Other overhead costs Total actual overhead incurred Overhead applied=(345000-80000)*0.7 Under applied overhead 15000 80000 120000 215000 185500 29500 Credit Account title cost of good sold Factory overhead Debit 29500 29500