HD Manufacturing uses a job costing system, and manufacturing overhead is applied on the basis of direct labour hours. At the beginning of the year, management estimated that the company would incur $1,485,000 of manufacturing overhead costs and incur 90,000 direct labour hours.

The following incomplete information is provided in relation to HD Manufacturing for the month of June:

(i) The actual labour rate is $22 per hour. A total of 7,500 labour hours were worked during normal working hours. Total cost of idle time incurred during the month was $5,410.

(ii) Jobs sold during the month were sold for $1,190,000 (credit sales). The cost of the goods sold during the month was $806,000.

(iii) Depreciation on factory equipment incurred during June was $6,300.

(iv) Electricity costs and sundry manufacturing overhead costs incurred during June were $92,000.

i) Complete the T accounts providing the amounts of (a) to (l) to show the flow of costs through the companys manufacturing accounts. (NB. No entry is required to close the amount of over/under applied overhead in this part of the question). (6 marks)

ii) Was manufacturing overhead under/over applied during January and by how much? Record the journal entry to close the under/over applied manufacturing overhead. (2 marks)

Raw Material Inventory Bal. 1/6 $68,000 b) a) Finished Goods Inventory Bal. 1/6 $65,000 h) g) Manufacturing Overhead j) 1) k) Sundry OH $92,000 Bal 30/6 $30,200 Bal 30/6 $32,300 Work in Process Inventory Bal. 1/6 $59,000 f) c) e) Bal 30/6 $29,200 Cost of Goods Sold i) Sales Revenue A/C Rec $1,190,000