A manufacturing company, Orion manufacturing, applies factory overhead based on direct labor hours. At the beginning of the year, it was estimated that factory overhead costs would be $420,000, and direct labor hours would be 60,000. Actual manufacturing overhead costs incurred were $400,000, and actual direct labor hours were 62,000. The journal entry to apply the factory overhead costs for the year would include a: a. Debit to Factory Overhead for $400,000 b. Credit to Factory Overhead for $420,000 c. Credit to Factory Overhead for $434,000 d. Debit to Factory Overhead for $434,000

A manufacturing company, Orion manufacturing, applies factory overhead based on direct labor hours. At the beginning of the year, it was estimated that factory overhead costs would be $420,000, and direct labor hours would be 60,000. Actual manufacturing overhead costs incurred were $400,000, and actual direct labor hours were 62,000. The journal entry to apply the factory overhead costs for the year would include a: a. Debit to Factory Overhead for $400,000 b. Credit to Factory Overhead for $420,000 c. Credit to Factory Overhead for $434,000 d. Debit to Factory Overhead for $434,000

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter3: Process Cost Systems

Section: Chapter Questions

Problem 4E: The cost accountant for River Rock Beverage Co. estimated that total factory overhead cost for the...

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When setting its predetermined overhead application rate. Tasty Turtle estimated its overhead would be $75,000 and manufacturing would require 25,000 machine hours in the next year. At the end of the year, it found that actual overhead was $74,000 and manufacturing required 24,000 machine hours. Determine the predetermined overhead rate. What is the overhead applied during the year? Prepare the journal entry to eliminate the under- or over applied overhead.
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