This problem is a continuation of problem 3-9 and requires journal entries based on the overhead calculations for the Anderson Company.

Required: Appendix: Prepare the following journal entries:

1. Record the actual manufacturing overhead. (Use “various accounts” for the credit side of the entry.) ;

2. Assuming that Anderson’s overhead application rate is $18, record the overhead allocated to production.

3. Close the over- or underapplication of overhead.

Problem 3-9

The Anderson Company allocates manufacturing overhead to production based on machine hours. The following information is available for Anderson:

Required:

a. Compute Anderson’s overhead allocation rate.

b. Assume that Anderson’s overhead application rate is $18. Calculate the amount of overhead that should be allocated to production.

Transcribed Image Text:

Estimated manufacturing overhead Actual manufacturing overhead Estimated machine hours Actual machine hours $2,000,000 $2,100,000 125,000 140,000