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Chapter 17: Q9SE-c (page 940)

Comparing actual to allocated overhead

Columbus Enterprises reports the following information at December 31, 2018:

Manufacturing overhead

3,500

50,600

19,000

34,500

Requirements

3. Is manufacturing overhead underallocated or overallocated? By how much?

Short Answer

Expert verified

The manufacturing overhead is underallocated by the amount $6,400

Step by step solution

01

Under allocation of overhead

The allocation of overhead is under allocated when the actual overhead incurred by the company is more than the allocated manufacturing overhead.

02

Underallocated overhead amount

The manufacturing overhead of the company is underallocated by the amount of $6,400

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Most popular questions from this chapter

June production generated the following activity in Bentley Chassis Company’s Work-in-Process Inventory account:

June 1 balance

\(36,000

Direct materials used

32,000

Direct labor assigned to jobs

40,000

Manufacturing overhead allocated to jobs

28,000

Additionally, Bentley Chassis has completed Jobs 142 and 143, with total costs of

\)37,000 and \(48,000, respectively.

Requirements

3. Prepare the journal entry to record the sale on account of Job 143 for \)63,000.

Also, prepare the journal entry to record Cost of Goods Sold for Job 143.

Distinguishing between job order costing and process costing

Would the following companies most likely use job order costing or process costing?

b. A manufacturer of specialtywakeboards

Root Trailers’ job cost records yielded the following information:

Use the dates in the table to identify the status of each job. Compute the following

balances for Root:

a. Work-in-Process Inventory at July 31

Give five examples of manufacturing overhead costs. Why are they consideredindirect costs?

Question: The following information pertains to Smith Company for the year:

Estimated manufacturing overhead

\(500,000

Actual manufacturing overhead

\)550,000

Estimated direct labor hours

10,000 hours

Actual direct labor hours

10,500 hours

13. Calculate the predetermined overhead allocation rate using direct labor hours as the allocation base.

14. Determine the amount of overhead allocated during the year. Record the journal entry.

15. Determine the amount of underallocated or overallocated overhead. Record the journal entry to adjust Manufacturing

Overhead.
See all solutions

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