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Calculate and Use Overhead Rate Selected data for the consulting department of Kingman Consulting, Inc., follow: Estimated consulting overhead cost for the year $1,215,000 Estimated
Calculate and Use Overhead Rate
Selected data for the consulting department of Kingman Consulting, Inc., follow:
Estimated consulting overhead cost for the year | $1,215,000 |
Estimated direct labor cost for the year (@ $9/hr.) | 810,000 |
Actual manufacturing overhead cost for May | 78,000 |
Actual direct labor cost forMay (2,400 hours) | 66,000 |
Assuming that direct labor cost is the basis for applying consulting overhead,
a. Calculate the predetermined overhead rate.
Answer%
b. Prepare a journal entry that applies consulting overhead for May.
General Journal | ||
---|---|---|
Description | Debit | Credit |
Consulting overhead, Cost of goods sold, Finished goods inventory or Work in process inventory | Answer | Answer |
Consulting overhead, Cost of goods sold, Finished goods inventory or Work in process inventory | Answer | Answer |
c. By what amount is consulting overhead over- or underapplied in May?
Consulting overhead was over-applied or under-applied by $Answer in May.
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