a) Compute the manufacturing costs ,cost of goods manufactured (COGM) and manufacturing overhead variance for the current
Question:
a) Compute the manufacturing costs ,cost of goods manufactured (COGM) and manufacturing overhead variance for the current year.
b)Compute the cost of goods sold (COGS) if the company closes overapplied or underapplied overhead cost into the cost of goods sold.
c)Present Solaris Power Ltd’s Income statement for the year.
d)Present the journal entry to close the manufacturing overhead control account if Solaris Power Ltd disposed of the manufacturing overhead variance as described in (b).
e)Present the journal entry to close off the balance in the manufacturing overhead account if instead of (d), Solaris Power Ltd closed off the manufacturing overhead variance by pro-rating the amount to the work in process, finished goods inventory and cost of goods sold
f)Explain the effect on profit between the two methods of closing off the manufacturing overhead described in (b) and (e).
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