Johnson Manufacturing has the following overhead data at year- end: ⚫ Applied overhead: $28,500,000 ⚫ Actual overhead: $29,800,000 If the over/under applied overhead is closed to Cost of Goods Sold, what will be the effect on net income?

Johnson Manufacturing has the following overhead data at year- end: ⚫ Applied overhead: $28,500,000 ⚫ Actual overhead: $29,800,000 If the over/under applied overhead is closed to Cost of Goods Sold, what will be the effect on net income?

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter4: Activity-based Costing

Section: Chapter Questions

Problem 11E: Ripley, Inc., costs products using a normal costing system. The following data are available for...

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Question

What will be the effect on net income solve this accounting questions

Johnson Manufacturing has the following overhead data at year-
end:
⚫ Applied overhead: $28,500,000
⚫ Actual overhead: $29,800,000
If the over/under applied overhead is closed to Cost of Goods Sold,
what will be the effect on net income?

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Ellerson Company provided the following information for the last calendar year: During the year, direct materials purchases amounted to 278,000, direct labor cost was 189,000, and overhead cost was 523,000. During the year, 100,000 units were completed. Refer to Exercise 2.21. Last calendar year, Ellerson recognized revenue of 1,312,000 and had selling and administrative expenses of 204,600. Required: 1. What is the cost of goods sold for last year? 2. Prepare an income statement for Ellerson for last year.
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