Company ERA is at its period end. ERA uses Absorption Accounting. Its Manufacturing Overhead clearing account has a CR balance of $309,375. During the period, ERA had several expenses that it had incurred, but not yet recognized: i. ii. iii. iv. Rent Expense $150,000 (25% office; 75% factory); Utilities Expense $125,000 (25% office; 75% factory); Indirect Factory Wages $75,000; Office Salaries $50,000. Required: Do the journal entry required for the unrecognized expenses. Assume all payments were made in cash. b. What is the new balance of the Manufacturing Overhead account? Based on the new balance of the Manufacturing Overhead account, state if the account is underapplied or overapplied? d. Based on your last answer, is there another journal entry required to close the period? If so, please write the required journal entry. If necessary, assume, production breakdown for the period is 30% WIP, 30% F/G and 40% COGS.

Company ERA is at its period end. ERA uses Absorption Accounting. Its Manufacturing Overhead clearing account has a CR balance of $309,375. During the period, ERA had several expenses that it had incurred, but not yet recognized: i. Rent Expense $150,000 ( 25% office; 75% factory); ii. Utilities Expense $125,000 ( 25% office; 75% factory); iii. Indirect Factory Wages $75,000; iv. Office Salaries $50,000. Required: a. Do the journal entry required for the unrecognized expenses. Assume all payments were made in cash. b. What is the new balance of the Manufacturing Overhead account? c. Based on the new balance of the Manufacturing Overhead account, state if the account is underapplied or overapplied? d. Based on your last answer, is there another journal entry required to close the period? If so, please write the required journal entry. If necessary, assume, production breakdown for the period is 30% WIP, 30%F/G and 40% COGS