Harwood Company uses a job-order costing system that applies overhead cost to jobs on the basis...
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Harwood Company uses a job-order costing system that applies overhead cost to jobs on the basis of machine-hours. The company's predetermined overhead rate of $2.70 per machine-hour was based on a cost formula that estimates $243,000 of total manufacturing overhead for an estimated activity level of 90,000 machine-hours. Required: 1. Assume that during the year the company works only 85,000 machine-hours and incurs the following costs in the Manufacturing Overhead and Work in Process accounts: Compute the amount of overhead cost that would be applied to Work in Process for the year and make the entry in your T-accounts. 2A. Compute the amount of underapplied or overapplied overhead for the year and show the balance in your Manufacturing Overhead T-account. 2B. Prepare a journal entry to close the company's underapplied or overapplied overhead to Cost of Goods Sold. Complete this question by entering your answers in the tabs below. Req 1 Req 2A Req 2B Compute the amount of overhead cost that would be applied to Work in Process for the year and make the entry in your T-accounts. (Maintenance) (Indirect materials) (Indirect labor) (Utilities) (Insurance) nonreciation) Manufacturing Overhead Work in Process Debit Credit Debit 31,000 (a) (Direct materials) 810,000 9,000 (Direct labor) 100,000 82,000 (Overhead) (a) 37,000 8,000 Credit Harwood Company uses a job-order costing system that applies overhead cost to jobs on the basis of machine-hours. The company's predetermined overhead rate of $2.70 per machine-hour was based on a cost formula that estimates $243,000 of total manufacturing overhead for an estimated activity level of 90,000 machine-hours. Required: 1. Assume that during the year the company works only 85,000 machine-hours and incurs the following costs in the Manufacturing Overhead and Work in Process accounts: Compute the amount of overhead cost that would be applied to Work in Process for the year and make the entry in your T-accounts. 2A. Compute the amount of underapplied or overapplied overhead for the year and show the balance in your Manufacturing Overhead T-account. 2B. Prepare a journal entry to close the company's underapplied or overapplied overhead to Cost of Goods Sold. Complete this question by entering your answers in the tabs below. Req 1 Req 2A Req 2B Compute the amount of overhead cost that would be applied to Work in Process for the year and make the entry in your T-accounts. (Maintenance) (Indirect materials) (Indirect labor) (Utilities) (Insurance) nonreciation) Manufacturing Overhead Work in Process Debit Credit Debit 31,000 (a) (Direct materials) 810,000 9,000 (Direct labor) 100,000 82,000 (Overhead) (a) 37,000 8,000 Credit
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Related Book For
Managerial Accounting
ISBN: 978-1259307416
16th edition
Authors: Ray Garrison, Eric Noreen, Peter Brewer
Posted Date:
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