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Maurice Company allocates overhead using direct labour - hours For 2016 , the estimated and actual labour -hours were 180,090 and 167 000...
The Company allocates overhead using direct labour-hours. For 2014, the estimated and actual labour-hours were 180,000 and 167,000 respectively, and the predetermined overhead rate used to apply overhead for the year was $24.80 per direct labour-hour. The manufacturing overhead control T-account showed a debit balance of $183,550 at the end of the year, and this balance was disposed of at the end of the year by closing it to cost of goods sold.
A) Was manufacturing OH under or overapplied?
B) Compute the actual OH amount incurred over the year.
C) Prepare the JE to close out the OH account.
D) Shown below is an income statement for the company, prior to posting the journal entry you just created in C). Indicate how the entry from C) would affect the income statement by making a manual correction right on the income statement.
Maurice Company allocates overhead using direct labour - hours For 2016 , the estimated and actuallabour -hours were 180,090and 167 000 respectively , and the predetermined overhead rate used toapply overhead for the year was $24 80 per direct labour - hour . The manufacturing overhead control Taccount showed a debit balance of $183 550 at the end of the year , and this balance was disposed of atthe end of the year by closing it to cost of goods soldRequired :1 . Was manufacturing overhead under - or oroverapplied ?Compute the actual overhead amount incurred over the year .Prepare the journal entry to close out the overhead accounthown below is an incomincome statement for the company , prior to posting the journal entry youjust created in 3 Indicate how the entry from 3 would affect the income statement by making amanual correction right on the income statementMaurice CompanyIncome StatemenFor the Year Ended December 31Sales .........................51 420 000Cost of goods sold ..1 1 17 150PRESIDENTOFGross margin ....02 850...............Selling and administrative expensesSalaries expense..........................."..services5150, 000Insurance expense .......... .1010."Marketing expense ...........100 0001010..10Depreciation expense12000- 262 , 600Operating income5 40 , 250