Question: Blackstone Incorporated had the following selected account balances at the end of 2014: Work in process $200,000 Finished goods 150,000 Cost of goods sold 250,000 Factory overhead (overapplied) 18,000 Amount of factory overhead applied in 2014 200,000 Required: a. Give the journal entry to record the factory overhead applied. b. What was the actual overhead for the year? c. Give the journal entry to dispose of the factory overhead balance assuming it is written off to the cost of goods sold. d. Give the journal entry to dispose of the factory overhead balance assuming it is allocated among work in process, finished goods, and cost of goods sold based on ending balances. e. Which method of disposing of under- or overapplied factory overhead cost is more accurate? Explain. When a member of the AICPA prepares a taxpayer's federal income tax return, the member has the responsibility to:A. be an advocate for the entity's position.B. verify the data to be used in preparing the return.C. take a position of independent neutrality.D. argue the position of the Internal Revenue Service..As the cost accounting manager at McKinley Industries (MI), you are responsible for compiling and reporting various performance measures to the senior managers. MI instituted many efficiency improvement programs recently and the CFO has asked you to measure and report total factor productivity based on three inputs (material, labor, and overhead). From the accounting records, you also gather the following information for the two years: Year 1 Year 2 Gallons input 45,200 40,500 Labor hours 50,100 39,300 Output (gallons) 26,500 20,100 Year 2 Year 1 Cost of inputs per gallon $ 69 $ 72 Wage rate per hour $ 18 $5 Total manufacturing overhead $28,70,000 $30,90,000 Selling price of output per gallon $ 380 $ 348 Compute the total factor productivity measures for year 1 and year 2 based on the three inputs (material, labor, and overhead).
Question: Blackstone Incorporated had the following selected account balances at the end of 2014: Work in process $200,000 Finished goods 150,000 Cost of goods sold 250,000 Factory overhead (overapplied) 18,000 Amount of factory overhead applied in 2014 200,000 Required: a. Give the journal entry to record the factory overhead applied. b. What was the actual overhead for the year? c. Give the journal entry to dispose of the factory overhead balance assuming it is written off to the cost of goods sold. d. Give the journal entry to dispose of the factory overhead balance assuming it is allocated among work in process, finished goods, and cost of goods sold based on ending balances. e. Which method of disposing of under- or overapplied factory overhead cost is more accurate? Explain. When a member of the AICPA prepares a taxpayer's federal income tax return, the member has the responsibility to:A. be an advocate for the entity's position.B. verify the data to be used in preparing the return.C. take a position of independent neutrality.D. argue the position of the Internal Revenue Service..As the cost accounting manager at McKinley Industries (MI), you are responsible for compiling and reporting various performance measures to the senior managers. MI instituted many efficiency improvement programs recently and the CFO has asked you to measure and report total factor productivity based on three inputs (material, labor, and overhead). From the accounting records, you also gather the following information for the two years: Year 1 Year 2 Gallons input 45,200 40,500 Labor hours 50,100 39,300 Output (gallons) 26,500 20,100 Year 2 Year 1 Cost of inputs per gallon $ 69 $ 72 Wage rate per hour $ 18 $5 Total manufacturing overhead $28,70,000 $30,90,000 Selling price of output per gallon $ 380 $ 348 Compute the total factor productivity measures for year 1 and year 2 based on the three inputs (material, labor, and overhead).
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:Question:
Blackstone Incorporated had the following selected
account balances at the end of 2014:
Work in process $200,000
Finished goods 150,000
Cost of goods sold 250,000
Factory overhead (overapplied) 18,000
Amount of factory overhead applied in 2014 200,000
Required:
a. Give the journal entry to record the factory overhead
applied.
b. What was the actual overhead for the year?
c. Give the journal entry to dispose of the factory overhead
balance assuming it is written off to the cost of goods sold.
d. Give the journal entry to dispose of the factory overhead
balance assuming it is allocated among work in process,
finished goods, and cost of goods sold based on ending
balances.
e. Which method of disposing of under- or overapplied
factory overhead cost is more accurate? Explain.
When a member of the AICPA prepares a taxpayer's
federal income tax return, the member has the
responsibility to:A. be an advocate for the entity's
position.B. verify the data to be used in preparing the
return.C. take a position of independent neutrality.D. argue
the position of the Internal Revenue Service..As the cost
accounting manager at McKinley Industries (MI), you are
responsible for compiling and reporting various
performance measures to the senior managers. MI
instituted many efficiency improvement programs recently
and the CFO has asked you to measure and report total
factor productivity based on three inputs (material, labor,
and overhead). From the accounting records, you also
gather the following information for the two years:
Year 1 Year 2
Gallons input
45,200 40,500
Labor hours
50,100 39,300
Output (gallons)
26,500 20,100
Year 2
Year 1
Cost of inputs per gallon
$ 69
$ 72
Wage rate per hour
$ 18
$5
Total manufacturing overhead
$28,70,000 $30,90,000
Selling price of output per gallon
$ 380
$ 348
Compute the total factor productivity measures for year 1
and year 2 based on the three inputs (material, labor, and
overhead).
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