Michael Scott Paper Co. uses a predetermined overhead allocation rate to allocate overhead to individual jobs, based on the machine hours required. At the beginning of 2020, the company expected to incur the following: Michael Scott Paper Co.Beginning of 2020 Manufacturing overhead costs $1,001,910 Direct labor costs $1,512,800 Number of Machine hours to be used 73,400 At the end of 2020, the company had actually incurred: Michael Scott Paper Co.End of 2020 Direct labor costs $1,219,700 Depreciation on manufacturing plant equipment $596,400 Property taxes on plant $39,600 Sales Salaries $28,400 Delivery drivers wages $25,600 Plant janitor's wages $17,100 Number of Machine hours actually used 65,700 (Round your answers to two decimal places when needed and use rounded answers for all future calculations). 1. Compute the predetermined overhead allocation rate. Total estimated overhead cost ? Total estimated quantity of the overhead allocation base = Predetermined Overhead Allocation Rate = 2. Prepare the journal entry to allocate overhead costs. Journal Date Description Debit Credit 3. Use the T-account to determine if the amount is underallocated or overallocated manufacturing overhead. Manufacturing Overhead Debit Credit Double line Double line 4. Prepare the journal entry to adjust for the underallocated or overallocated manufacturing overhead. Journal Date Description Debit Credit
Michael Scott Paper Co. uses a predetermined overhead allocation rate to allocate overhead to individual jobs, based on the machine hours required. At the beginning of 2020, the company expected to incur the following: Michael Scott Paper Co.Beginning of 2020 Manufacturing overhead costs $1,001,910 Direct labor costs $1,512,800 Number of Machine hours to be used 73,400 At the end of 2020, the company had actually incurred: Michael Scott Paper Co.End of 2020 Direct labor costs $1,219,700 Depreciation on manufacturing plant equipment $596,400 Property taxes on plant $39,600 Sales Salaries $28,400 Delivery drivers wages $25,600 Plant janitor's wages $17,100 Number of Machine hours actually used 65,700 (Round your answers to two decimal places when needed and use rounded answers for all future calculations). 1. Compute the predetermined overhead allocation rate. Total estimated overhead cost ? Total estimated quantity of the overhead allocation base = Predetermined Overhead Allocation Rate = 2. Prepare the journal entry to allocate overhead costs. Journal Date Description Debit Credit 3. Use the T-account to determine if the amount is underallocated or overallocated manufacturing overhead. Manufacturing Overhead Debit Credit Double line Double line 4. Prepare the journal entry to adjust for the underallocated or overallocated manufacturing overhead. Journal Date Description Debit Credit
Chapter1: Financial Statements And Business Decisions
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The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
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Michael Scott Paper Co. uses a predetermined overhead allocation rate to allocate overhead to individual jobs, based on the machine hours required.
At the beginning of 2020, the company expected to incur the following:
Michael Scott Paper Co.Beginning of 2020
Michael Scott Paper Co.End of 2020
1. Compute the predetermined overhead allocation rate.
2. Prepare the journal entry to allocate overhead costs.
Journal
3. Use the T-account to determine if the amount is underallocated or overallocated manufacturing overhead.
Manufacturing Overhead
4. Prepare the journal entry to adjust for the underallocated or overallocated manufacturing overhead.
Journal
At the beginning of 2020, the company expected to incur the following:
Michael Scott Paper Co.Beginning of 2020
| $1,001,910 | |
| Direct labor costs | $1,512,800 |
| Number of Machine hours to be used | 73,400 |
At the end of 2020, the company had actually incurred:
Michael Scott Paper Co.End of 2020
| Direct labor costs | $1,219,700 |
|---|---|
| $596,400 | |
| Property taxes on plant | $39,600 |
| Sales Salaries | $28,400 |
| Delivery drivers wages | $25,600 |
| Plant janitor's wages | $17,100 |
| Number of Machine hours actually used | 65,700 |
(Round your answers to two decimal places when needed and use rounded answers for all future calculations).
1. Compute the predetermined overhead allocation rate.
| Total estimated overhead cost | ? | Total estimated quantity of the overhead allocation base | = | Predetermined Overhead Allocation Rate |
|---|---|---|---|---|
| = |
2. Prepare the journal entry to allocate overhead costs.
Journal
| Date | Description | Debit | Credit |
|---|---|---|---|
3. Use the T-account to determine if the amount is underallocated or overallocated manufacturing overhead.
Manufacturing Overhead
| Debit | Credit |
|---|---|
| Double line | Double line |
4. Prepare the journal entry to adjust for the underallocated or overallocated manufacturing overhead.
Journal
| Date | Description | Debit | Credit |
|---|---|---|---|
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