During the month of August, Star Plastics applied overhead to jobs using an overhead rate of $3

Question:

During the month of August, Star Plastics applied overhead to jobs using an overhead rate of $3 per dollar of direct labor. Direct labor in August was $100,000. Actual overhead in August was $260,000. Assume that actual overhead was composed of the following items.

Indirect materials.............................. $ 40,000

Indirect labor..................................... 80,000

Utilities............................................ 25,000

Depreciation..................................... 60,000

Repair expense.................................. 55,000

Total........................................... $260,000

Required

a. Prepare a journal entry to record overhead applied to jobs.

b. Prepare a journal entry to record actual overhead.

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