Biloxi Billiards Company uses normal costing, and manufacturing overhead is applied - 75978

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yousafbhutta

yousafbhutta

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  • From: Business, Accounting
  • Posted on: Mon 27 Oct, 2014
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Request Description
Biloxi Billiards Company uses normal costing, and manufacturing overhead is applied to work in process on the basis of machine hours. On January 1 of the current year there were no balances in work-in-process or finished-goods inventories. The following estimates were included in the current year’s budget. Total budgeted manufacturing overhead $306,000 Total budgeted machine hours 51,000 ________________________________________ During January, the firm began the following production jobs: M07: 1,200 machine hours T28: 3,000 machine hours B19: 1,800 machine hours During January, job numbers M07 and T28 were completed, and job number M07 was sold. The actual manufacturing overhead incurred during January was $38,000. Required: 1. Compute the company’s predetermined overhead rate for the current year. 2. How much manufacturing overhead was applied to production during January? 3. Calculate the overapplied or underapplied overhead for January. 4. Prepare a journal entry to close the balance calculated in requirement (3) into Cost of Goods Sold.
Solution Description

Biloxi Billiards Company uses normal costing, and manufacturing overhead is applied to work in process on the basis of machine hours. On January 1 of the current year there were no balances in work-in-process or finished-goods inventories. The following estimates were include