cjulius9437
25.06.2021 •
Business
Manufacturing overhead was estimated to be $400,000 for the year along with 20,000 direct labon hours. Actual manufacturing overhead was $415,000, actual labor hours were 21,000. To dispose of the balance in the manufacturing overhead account, which of the following would be correct?
a. Cost of Goods sold would be credited for $5,000.
b. Cost of Goods Sold would be debited for $5,000.
c. Cost of Goods Sold would be credited for $15,000.
d. Cost of Goods Sold would be debited for $15,000.
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Ответ:
If overhead was overapplied, then the COGS should be debited overhead.
The correct answer is B.
Explanation:
First, we need to calculate the predetermined overhead rate:
Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Predetermined manufacturing overhead rate= 400,000 / 20,000
Predetermined manufacturing overhead rate= $20 per DLH
Now, we allocate overhead:
Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base
Allocated MOH= 20*21,000
Allocated MOH= $420,000
Finally, the over/under allocation:
Under/over applied overhead= real overhead - allocated overhead
Under/over applied overhead= 415,000 - 420,000
Overapplied overhead= $5,000
If overhead was overapplied, then the COGS should be debited overhead.
Ответ:
B. Equilibrium point.
Explanation:
This is the point you have enough in stock to sell, and available buyers at hand, without you bothering about the surplus of the inventory or how to keep up with the cost of storage. Hopes this helps