Butler Manufacturing uses a job order cost accounting system. On April 1, the company has Work in Process Inventory of $7,600 and two jobs in process: Job No. 221, $3,600, and Job No. 222, $4,000. The company uses direct labor cost to allocate the manufacturing overhead. It estimates $36,000 as annual manufacturing overhead and $60,000 as annual direct labor cost.

During April, a summary of source documents reveals the following:

Materials Requisition Slips Labor Time Tickets

Job No. 221 $1,200 $2,600

222 1,700 1,200

223 2,400 2,900

224 2,100 2,800

General use 600 400

Totals $8,000 $9,900

Additional manufacturing overhead cost incurred during the month are: Utilities bill $1,200, Depreciation $800, factory rent $1,000.

Job No. 221 is completed during the month.

Instructions

(a) Compute the overhead allocation rate.

(b) Prepare summary journal entries to record the raw materials requisitioned, factory labor used, and other overhead incurred during the month, the assignment of manufacturing overhead to jobs, and the completion of Job No. 221.

(c) Calculate the balance of the Work in Process Inventory account on April 30.

(d) Calculate the amount of over or under applied overhead, and prepare the required journal entry to close this amount.