Data Table Selected cost data for Classic Poster, Co. are as follows EEE (Click

Question

Data Table Selected cost data for Classic Poster, Co. are as follows EEE (Click the icon to view the cost data.) Read the requirements Estimated manufacturing overhead cost for the year Estimated direct labor cost for the year Actual manufacturing overhead cost for the year Actual direct labor cost for the year S 106,000 84,800 115,000 68,000 Requirement 1. Compute the predetermined overhead allocation rate per direct labor dollar. Predetermined overhead allocation rate Print Done Requirement 2. Prepare the journal entry to allocate overhead cost for the year. (Record debits first, then credits Date Accounts Debit Credit Dec. 31 Requirement 3. Use a T-account to determine the amount of underallocated or overallocated manufacturing overhead. Start by posting the actual and allocated manufacturing overhead to the T-account. (Use the first available cell to post each amount. Do not input the balance in the T-account.) Manufacturing Overhead Manufacturing overhead is Requirement 4. Prepare the journal entry to adjust for the underallocated or overallocated manufacturing overhead. (Record debits first, then credits. Exclude explanations from journal entries.) Date Accounts Debit Credit Dec. 31

Explanation / Answer

Requirement 1 predetermined Estimated manufacturing overhead / Estimated direct labor= overhead rate 106,000 / 84,800 = 1.25 Requirement 2 Date 31-Dec                         Accounts                           Debit Credit Work in process inventory 85000 Manufacturing overhead 85,000 (68000*1.25) Requirement 3              Manufacturing overhead           115,000 85,000 Manufacturing overhead is underapplied by 30,000 Requirement 4 Date 31-Dec                         Accounts                           Debit Credit cost of goods sold 30,000 Manufacturing overhead 30,000

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