How do you solve this problem? ---### Assessing Overhead Application in Cost AccountingThis section guides you through the process to determine whether your factory overhead is over- or underapplied. Follow the steps by entering the necessary data into the corresponding fields.#### Step 1: Data EntryUtilize the provided table to input the required variables for calculating overhead application.#### Factory Overhead Calculation Table- The table features rows and columns designed for inputting specific overhead data.- The first column represents different categories or components of factory overhead.- Subsequent columns are for entering relevant data, including the budgeted overhead, actual overhead, and overhead applied based on predetermined rates.#### Example Table Structure:| | Budgeted Overhead | Actual Overhead | Overhead Applied ||-----------------|-------------------|-----------------|------------------|| **Category 1** | | | || **Category 2** | | | || **Category 3** | | | |Use the dropdown menu within the table to select or specify certain conditions or calculations as needed.#### Step 2: Interpretation- Upon completing the data entry, analyze the figures to comprehend the status of your overhead: - **Overapplied Overhead**: When the applied overhead exceeds the actual overhead incurred. - **Underapplied Overhead**: When the actual overhead incurred is more than the applied overhead.#### Navigation- To move forward or backward within the sections, use the provided navigation buttons: - **Overhead Absorption**: For inputting and reviewing the applied overhead data. - **General Journal**: For proceeding to the journal entries related to adjusting over- or underapplied overhead.---For further guidance, access the tabs labeled "Overhead Absorption" and "General Journal" to enter and review your answers systematically. ### Exercise 15-13 Adjusting Factory Overhead LO P4#### The following information is available for Lock-Tite Company, which produces special-order security products and uses a job order costing system.| | April 30 | May 31 || --- | --- | --- || **Inventories** | | || Raw materials | $51,000 | $68,000 || Work in process | 11,800 | 24,500 || Finished goods | 71,000 | 51,600 || | | || **Activities and Information for May** | | || Raw materials purchases (paid with cash) | | 226,000 || Factory payroll (paid with cash) | | 377,000 || Factory overhead | | || Indirect materials | | 31,000 || Indirect labor | | 96,000 || Other overhead costs | | 136,000 || Sales (received in cash) | | 1,560,000 || Predetermined overhead rate based on direct labor cost | | 70% |**Tasks:**1. Determine whether there is over or underapplied overhead.2. Prepare the journal entry to allocate (close) overapplied or underapplied overhead to Cost of Goods Sold.**Explanation:**To find out if overhead is over or underapplied, you compare the actual overhead costs incurred with the overhead costs applied to production based on the predetermined overhead rate.**Step-by-Step Instructions:**1. **Calculate the actual overhead incurred:** Actual overhead is given by the sum of indirect materials, indirect labor, and other overhead costs. \[ \text{Actual Overhead} = \$31,000 + \$96,000 + \$136,000 = \$263,000 \]2. **Calculate the applied overhead:** Applied overhead is calculated using the predetermined overhead rate and the actual direct labor cost for May. Direct labor cost = Factory payroll = \$377,000 \[ \text{Applied Overhead} = \text{Direct Labor Cost} \times \text{Predetermined Overhead Rate

Introduction: Journals: Recording of a business transactions in a chronological order. First step in…

The following information is available for Lock-Tite Company, which produces special-order security products and uses a job order costing system. April 30 May 31 Inventories Raw materials $51,000 11,800 71,000 $ 68,000 24,500 51,600 Work in process Finished goods Activities and information for May Raw materials purchases (paid with cash) Factory payroll (paid with cash) Factory overhead Indirect materials 226,000 377,000 31,000 96,000 136,000 1,560,000 Indirect labor Other overhead costs Sales (received in cash) Predetermined overhead rate based on direct labor cost 70% Determine whether there is over or underapplied overhead. Prepare the journal entry to allocate (close) overapplied or underapplied overhead to Cost of Goods Sold.

The following information is available for Lock-Tite Company, which produces special-order security products and uses a job order costing system. April 30 May 31 Inventories Raw materials $51,000 11,800 71,000 $ 68,000 24,500 51,600 Work in process Finished goods Activities and information for May Raw materials purchases (paid with cash) Factory payroll (paid with cash) Factory overhead Indirect materials 226,000 377,000 31,000 96,000 136,000 1,560,000 Indirect labor Other overhead costs Sales (received in cash) Predetermined overhead rate based on direct labor cost 70% Determine whether there is over or underapplied overhead. Prepare the journal entry to allocate (close) overapplied or underapplied overhead to Cost of Goods Sold.

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter10: Accounting Systems For Manufacturing Operations

Section: Chapter Questions

Problem 10.4.2C: Factory overhead rate Fabricator Inc., a specialized equipment manufacturer, uses a job order cost...

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خدمات التعلم الإلكتروني SQU PORTAL ATTENDANCE SQU E 0.30:52 Royal Furniture Co. uses a job-order costing system with a single plantwide predetermined overhead rate based on machine-hours. The company based its predetermined overhead rate for the current year on total estimated manufacturing overhead cost of $760,000 and 40,000 machine-hours. The job sheet of Job F2412 shows that the number of units produced in this job order is 25 units. This job required 225 machine- hours and incurred direct materials cost of $350 and direct labor costs of $1.250. The unit product cost for Job F2412 is approximately aibi 27 إنهاء الم None of the given answers .a $475b O $83 C $73 d $235