6 . Depreciation on the company ' s office building was $ 8,100 .
7 . Manufacturing overhead was applied at the rate of 150 % of direct labor cost .
8 . Goods costing $ 88,000 were completed and transferred to finished goods .
9 . Finished goods costing $ 75,000 to manufacture were sold on account for $ 103,000 .
Instructions Journalize the transactions . E2-13
Tombert Decorating uses a job order cost system to collect the costs of its interior decorating business . Each client ' s consultation is treated as a separate job . Overhead is applied to each job based on the number of decorator hours incurred . Listed below are data for the current year .
Estimated overhead $ 960,000 Actual overhead $ 982,800 Estimated decorator hours 40,000 Actual decorator hours 40,500
The company uses Operating Overhead in place of Manufacturing Overhead .
Instructions ( a ) Compute the predetermined overhead rate . ( b ) Prepare the entry to apply the overhead for the year .
( c ) Determine whether the overhead was under- or over applied and by how much .
P2-4A