Aspen Company estimates its manufacturing overhead to be $512,000 and its direct labor costs to be $512,000 for year 2. Aspen worked three jobs for the year. Job 2-1, which was sold during year 2, had actual direct labor costs of $220,995. Job 2-2, which was completed, but not sold at the end of the year, had actual direct labor costs of $433,805. Job 2-3, which is still in work-in-process inventory, had actual direct labor costs of $163,700. The actual manufacturing overhead for year 2 was $827,400. Manufacturing overhead is applied on the basis of direct labor costs. Required: Prepare an entry to allocate over-or underapplied overhead to Work in Process, Finished Goods, and Cost of Goods Sold.

Aspen Company estimates its manufacturing overhead to be $512,000 and its direct labor costs to be $512,000 for year 2. Aspen worked three jobs for the year. Job 2-1, which was sold during year 2, had actual direct labor costs of $220,995. Job 2-2, which was completed, but not sold at the end of the year, had actual direct labor costs of $433,805. Job 2-3, which is still in work-in-process inventory, had actual direct labor costs of $163,700. The actual manufacturing overhead for year 2 was $827,400. Manufacturing overhead is applied on the basis of direct labor costs. Required: Prepare an entry to allocate over-or underapplied overhead to Work in Process, Finished Goods, and Cost of Goods Sold.

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter4: Accounting For Factory Overhead

Section: Chapter Questions

Problem 15E: The books of Petry Products Co. revealed that the following general journal entry had been made at...

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