The following information is available to Lock-Tite Company, which manufactures security products to special order and uses a job costing system.

	April 30th				may 31
inventories
Raw Materials	ps	46,000			ps	58,000
Work in progress		10,800				22,500
Finished products		66,000				41,600
Mayo activities and information
Raw material purchases (paid in cash)						216,000
Factory payroll (cash payment)						357,000
Factory overhead
indirect materials						21,000
indirect work						86,000
Other general expenses						126,000
Sales (received in cash)						1,460,000
Default overhead rate based on direct labor cost						75	%

Determine if there are over- or under-applied overheads.

Factory overhead
indirect materials
indirect work
Other general expenses

Prepare the journal entry to allocate (close) overhead or underapplied overhead to cost of goods sold.

Journal Entry Worksheet

• Record the entry to allocate (close) the underapplied/overapplied overhead to cost of goods sold.

Note: Enter debits before credits.

Transaction	General diary	Debit	Credit
1	cost of goods sold
	Factory overhead

Answer rating: 100% (QA)

To determine if there are over or underapplied overheads for LockTite Company we need to calculate the applied overhead and compare it to the actual o... View the full answer