Compute the predetermined overhead application rate

Assignment Help Financial Accounting

Reference no: EM133433246

Junior Company uses a job-order costing system and a predetermined overhead rate based on machine hours.

At the beginning of the year, the company estimated manufacturing overhead for the year would be $800,000 and machine hours used would be 20,000.

The following information pertains to March of the current year:

Job 20 Job 21 Job 22 Totals

Beginning balance $36,000 $54,000 $60,000 $150,000

Current period costs added:

Direct materials requisitioned (used) $40,000 $45,000 $35,000 $120,000

Direct labor costs $28,000 $40,000 $27,000 $95,000

Current period activity

Machine hours 2,100 2,300 2,600 7,000

Assume that Jobs 20 and 21 are completed during the month and that Job 20 was sold on account for $250,000.

Required:

a. Compute the predetermined overhead application rate for the year.

b. Determine the total cost (including beginning inventory) assigned to each job.

Job 20

Job 21

Job 22

c. Give the journal entry to record the total amount of direct material costs requisitioned (used) on all three jobs.

d. Give the journal entry to record the total amount of overhead applied to all three jobs.

e. Give the journal entry to record the completion of Jobs 20 and 21.

f. Give the journal entries to record (1) the sale and (2) the cost of sale of Job 20.

g. What are the ending balances in these accounts?

i. Work-in-process inventory

ii. Finished goods inventory

iii. Cost of goods sold

Reference no: EM133433246

Questions Cloud

How did organizations interact with their external : How did organizations interact with their external environment (as open systems). That effected West Chester Private Schools (WCPS) as an open system

Build an environment of the business : Build an environment of the business (follow the principles and focus points you need of this component) on the sale transaction

How do these two pieces of information assist in creating : Why is it important to conduct an internal job evaluation for an organization, but also look externally for market data? How do these two pieces

Andre leased his condo unit in favor of brian : Andre leased his condo unit in favor of Brian. Brian subleased the property to Chel. Brian violated the conditions of lease,

Compute the predetermined overhead application rate : Compute the predetermined overhead application rate for the year and Determine the total cost (including beginning inventory) assigned to each job

How attitudes of today workers towards career development : How the attitudes of today's workers towards career development and personal learning may influence career decisions. Refer to the methods and justifications

How an organization-wide ethical dilemma impacts : assess how an organization-wide ethical dilemma impacts the organization internally and other outside parties. Describe in detail the organization-wide ethical

Blockchain in supply chain settings : Examine on the basis of the extant literature, the benefits that could be had from the application of Blockchain in Supply Chain settings.

Explain why this is an issue from the union perspective : Explain why this is an issue from the union's perspective and explain any proposed revisions. Write a new article that would replace 14.02 that would reflect

User Account

All Pages