The following information is taken from the accounts of Latta Company. The entries in the T-accounts...
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The following information is taken from the accounts of Latta Company. The entries in the T-accounts are summaries of the transactions that affected those accounts during the year. Manufacturing Overhead Debit Credit Credit 472,320 (b) 393,600 Balance 16,400 (c) 730,000 277,500 87,500 (b) 393,600 Balance 45,000 (a) Balance 78,720 Work in Process Credit Debit Finished Goods $ 21,600 60,000 312,000 $ 393,600 Debit Credit Balance 45,000 (d) 650,000 (e) 730,000 Balance 125,000 Cost of Goods Sold Debit (d) 650,000 The overhead that had been applied to production during the year is distributed among Work in Process, Finished Goods, and Cost of Goods Sold as of the end of the year as follows: Work in Process, ending Finished Goods, ending Cost of Goods Sold Overhead applied For example, of the $45,000 ending balance in work in process, $21,600 was overhead that had been applied during the year. Required: 1. Identify reasons for entries (a) through (d). 2. Assume that the underapplied or overapplied overhead is closed to Cost of Goods Sold. Prepare the necessary journal entry. 3. Assume that the underapplied or overapplied overhead is closed proportionally to Work in Process, Finished Goods, and Cost of Goods Sold. Prepare the necessary journal entry. The following information is taken from the accounts of Latta Company. The entries in the T-accounts are summaries of the transactions that affected those accounts during the year. Manufacturing Overhead Debit Credit Credit 472,320 (b) 393,600 Balance 16,400 (c) 730,000 277,500 87,500 (b) 393,600 Balance 45,000 (a) Balance 78,720 Work in Process Credit Debit Finished Goods $ 21,600 60,000 312,000 $ 393,600 Debit Credit Balance 45,000 (d) 650,000 (e) 730,000 Balance 125,000 Cost of Goods Sold Debit (d) 650,000 The overhead that had been applied to production during the year is distributed among Work in Process, Finished Goods, and Cost of Goods Sold as of the end of the year as follows: Work in Process, ending Finished Goods, ending Cost of Goods Sold Overhead applied For example, of the $45,000 ending balance in work in process, $21,600 was overhead that had been applied during the year. Required: 1. Identify reasons for entries (a) through (d). 2. Assume that the underapplied or overapplied overhead is closed to Cost of Goods Sold. Prepare the necessary journal entry. 3. Assume that the underapplied or overapplied overhead is closed proportionally to Work in Process, Finished Goods, and Cost of Goods Sold. Prepare the necessary journal entry.
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Related Book For
Introduction to Managerial Accounting
ISBN: 978-1259105708
5th Canadian edition
Authors: Peter C. Brewer, Ray H. Garrison, Eric Noreen, Suresh Kalagnanam, Ganesh Vaidyanathan
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