Golding Company applies overhead based on direct labor cost. During the first quarter, the following activity took place in each of the accounts listed below.

Job 32 was the only job in process at the end of the first quarter. A total of 1,000 direct la¬
bor hours at $10 per hour were charged to Job 32.
Required:
1. Assuming that overhead is applied on the basis of direct labor cost, what was the over¬
head rate used during the first quarter?
2. What was the applied overhead for the first quarter? The actual overhead? The underor overapplied overhead?
3. What was the cost of the goods manufactured for the quarter?
4. Assume that the overhead variance is closed to Cost of Goods Sold. Prepare the jour¬
nal entry to close out the overhead account. What is the adjusted balance in Cost of Goods Sold?
5. For Job 32, identify the costs incurred for direct labor, direct materials, and overhead.

Transcribed Image Text:

Work in Process Bal 20,000 DL 80,000 OH 120,000 Finished Goods 230,000 Bal 40,000 200,000 230,000 Bal 70,000 DM 40,000 Bal 30,000 Overhead Cost of Goods Sold 128,500 120,000 200,000 Bal 8,500