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Selected data for the consulting department of Austin Consulting, Inc., follow: Estimated consulting overhead cost for the year Estimated direct labor cost for the year (@ $9/hr.) Actual manufacturing overhead cost for January Actual direct labor cost for January (1,200 hours) $810,000 450,000 48,000 33,000 Assuming that direct labor cost is the basis for applying consulting overhead. a. Calculate the predetermined overhead rate. b. Prepare a journal entry that applies to consult overhead for January. c. By what amount is consulting overhead over or underapplied in January?

Selected data for the consulting department of Austin Consulting, Inc., follow: Estimated consulting overhead cost for the year Estimated direct labor cost for the year (@ $9/hr.) Actual manufacturing overhead cost for January Actual direct labor cost for January (1,200 hours) $810,000 450,000 48,000 33,000 Assuming that direct labor cost is the basis for applying consulting overhead. a. Calculate the predetermined overhead rate. b. Prepare a journal entry that applies to consult overhead for January. c. By what amount is consulting overhead over or underapplied in January?

FINANCIAL ACCOUNTING
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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Selected data for the consulting department of Austin Consulting, Inc., follow: Estimated consulting overhead cost for the year Estimated direct labor cost for the year (@ $9/hr.) Actual manufacturing overhead cost for January Actual direct labor cost for January (1,200 hours) $810,000 450,000 48,000 33,000 Assuming that direct labor cost is the basis for applying consulting overhead. a. Calculate the predetermined overhead rate. b. Prepare a journal entry that applies to consult overhead for January. c. By what amount is consulting overhead over or underapplied in January?
Transcribed Image Text:Selected data for the consulting department of Austin Consulting, Inc., follow: Estimated consulting overhead cost for the year Estimated direct labor cost for the year (@ $9/hr.) Actual manufacturing overhead cost for January Actual direct labor cost for January (1,200 hours) $810,000 450,000 48,000 33,000 Assuming that direct labor cost is the basis for applying consulting overhead. a. Calculate the predetermined overhead rate. b. Prepare a journal entry that applies to consult overhead for January. c. By what amount is consulting overhead over or underapplied in January?
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