Fossil Manufacturing uses a predetermined overhead rate of $18.20 per direct labor-hour. This predetermined rate was based on 11.400 estimated direct-labor-hours and $207,480 of estimated total manufacturing overhead. The company incurred actual manufacturing overhead costs of $206,000 and 10,900 direct labor-hours. Required: a. Determine the amount of underapplied or overapplied manufacturing overhead for the period. b. Assuming that the company closed manufacturing overhead to cost of goods sold, make the journal entry to close manufacturing overhead. c. What is the effect of this entry on the company's gross margin? Complete this question by entering your answers in the table below. Required A Required B Required C -termine the amount of underapplied or overapplied manufacturing overhead for the period. facturing overhead for the period is < Required A by Required B >
Fossil Manufacturing uses a predetermined overhead rate of $18.20 per direct labor-hour. This predetermined rate was based on 11.400 estimated direct-labor-hours and $207,480 of estimated total manufacturing overhead. The company incurred actual manufacturing overhead costs of $206,000 and 10,900 direct labor-hours. Required: a. Determine the amount of underapplied or overapplied manufacturing overhead for the period. b. Assuming that the company closed manufacturing overhead to cost of goods sold, make the journal entry to close manufacturing overhead. c. What is the effect of this entry on the company's gross margin? Complete this question by entering your answers in the table below. Required A Required B Required C -termine the amount of underapplied or overapplied manufacturing overhead for the period. facturing overhead for the period is < Required A by Required B >
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:Fossil Manufacturing uses a predetermined overhead rate of $18.20 per direct labor-hour. This predetermined rate was based on
11.400 estimated direct-labor-hours and $207,480 of estimated total manufacturing overhead. The company incurred actual
manufacturing overhead costs of $206,000 and 10,900 direct labor-hours.
Required:
a. Determine the amount of underapplied or overapplied manufacturing overhead for the period.
b. Assuming that the company closed manufacturing overhead to cost of goods sold, make the journal entry to close manufacturing
overhead.
c. What is the effect of this entry on the company's gross margin?
Complete this question by entering your answers in the table below.
Required A Required B Required C
Determine the amount of underapplied or overapplied manufacturing overhead for the period.
anufacturing overhead for the period is
< Required A
by
Required B >
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