Question

During the first quarter of 2020, Frenchie Company reports the following: 1. Estimated overhead $222,045 2. Actual overhead $220,760 3. Estimated labour costs $169,500 4. Actual labour costs $175,600 The company allocates its overhead on the basis of direct labour cost. Calculate the predetermined overhead rate. (Round answer to the nearest whole percentage, e.g. 152%.) Predetermined overhead rate LINK TO TEXT LINK TO TEXT Calculate the over- or under-applied manufacturing overhead. (Round answers to the nearest whole dollar, e.g. 5,275.) Actual manufacturing overheads Applied manufacturing overhead Manufacturing overhead LINK TO TEXT LINK TO TEXT Prepare the adjusting entry to close the under- or over-applied overhead. (Credit account tities are automatically indented when the amount is entered. Do not indent manually. Round answers to the nearest whole dollar, e.g. 5,275.) Account Titles and Explanation Debit Credit

Answer 1

Estimated overheads = $222,045

Estimated direct labor costs = $169,500

Predetermined overhead rate = Estimated overheads/Estimated direct labor costs

= 222,045/169,500

= 131%

Applied manufacturing overheads = Actual direct labor costs x Predetermined overhead rate

= 175,600 x 131%

= $230,036

Actual manufacturing overheads	220,760
Applied manufacturing overheads	$230,036
Manufacturing overhead	$9,276	Over applied

Journal

Manufacturing overhead	$9,276
Cost of goods sold		$9,276
(To close Over applied Manufacturing overhead)

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