E2-5 Duggan Company applies manufacturing overhead to jobs on the basis of machine hours used.

E2-5 Duggan Company applies manufacturing overhead to jobs on the basis of machine hours used.
Overhead costs are expected to total$325,000 for the year, and machine usage is estimated at
125,000hours.
For the year$342,000 of overhead costs are incurred and130,000machine hours are
used.
 
Instructions:

(a) Compute the manufacturing overhead rate for the year.

(b) What is the amount of under- or overapplied overhead at December 31?

(c) Assuming the under- or overapplied overhead for the year is not allocated to inventory accounts, prepare the adjusting entry to assign the amount to cost of goods sold.
    • Posted: 4 years ago
    E2-5 Duggan Company applies manufacturing overhead to jobs on the basis of machine hours used.

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