manufacturing overhead cost Budgeted direct manufacturing labor cost Actual manufacturing overhead cost Actual direct manufacturing labor cost $125,000 $250,000 $117,000 $228,000 Inventory balances on December 31, 2017, were as follows: 2017 direct manufacturing labor cost in ending balance Ending balance Account Work in process Finished goods Cost of goods sold $ 50,700 245,050 549,250 $ 20,520 59,280 148,200 Required 1. Calculate the manufacturing overhead allocation rate. Compute the amount of under- or overallocated manufacturing overhead. 3. Calculate the ending balances in work in process, finished goods, and cost of goods sold if under- or overallocated manufacturing overhead is as follows: a. Written off to cost of goods sold b. Prorated based on ending balances (before proration) in each of the three accounts c. Prorated based on the overhead allocated in 2017 in the ending balances (before proration) in each of the three accounts 4. Which method would you choose? Justify your answer.

manufacturing overhead cost Budgeted direct manufacturing labor cost Actual manufacturing overhead cost Actual direct manufacturing labor cost $125,000 $250,000 $117,000 $228,000 Inventory balances on December 31, 2017, were as follows: 2017 direct manufacturing labor cost in ending balance Ending balance Account Work in process Finished goods Cost of goods sold $ 50,700 245,050 549,250 $ 20,520 59,280 148,200 Required 1. Calculate the manufacturing overhead allocation rate. Compute the amount of under- or overallocated manufacturing overhead. 3. Calculate the ending balances in work in process, finished goods, and cost of goods sold if under- or overallocated manufacturing overhead is as follows: a. Written off to cost of goods sold b. Prorated based on ending balances (before proration) in each of the three accounts c. Prorated based on the overhead allocated in 2017 in the ending balances (before proration) in each of the three accounts 4. Which method would you choose? Justify your answer.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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1.
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THIS is cOST ACCOUNTING FOR FACTORY OVERHEAD. PLEASE ANSWER AND SHOW SOLUTIONS