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5. Manufacturing overhead costs incurred on account were
$80,500.
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.