Baxter Company has two processing departments: assembly and finishing. A predetermined overhead rate of $10 per direct
Question:
Baxter Company has two processing departments: assembly and finishing. A predetermined overhead rate of $10 per direct labor hour is used to assign overhead to production.
The company experienced the following operating activity for April:
a. Issued materials to assembly, $24,000.
b. Incurred direct labor cost: assembly, 500 hours at $9.20 per hour; finishing, 400 hours at $8 per hour.
c. Applied overhead to production.
d. Transferred goods to finishing, $32,500.
e. Transferred goods to finished goods warehouse, $20,500.
f. Incurred actual overhead, $10,000.
Required:
1. Prepare the required journal entries for the preceding transactions.
2. Assuming assembly and finishing have no beginning work-in-process inventories, determine the cost of each department’s ending work-in-process inventories.
Step by Step Answer:
Cost Management Accounting And Control
ISBN: 9780324233100
5th Edition
Authors: Don R. Hansen, Maryanne M. Mowen