PART 7: JOB COSTING 25 POINTS Krazy Kayaks manufactures kayaks. The company has automated production, so it allocates manufacturing overhead based on machine hours. Krazy expects to incur $240,000 of manufacturing overhead costs and to use 4,000 machine hours during 2015. At the end of 2014, Krazy reported the following inventories: Raw Materials Inventory $20,000 Work-in-Process Inventory $17,000 Finished Goods Inventory $11,000 During January 2015, Krazy used 300 machine hours and recorded the following transactions: a. Purchased materials on account, $31,000 b. Used direct materials, $39,000 c. Manufacturing wages incurred totaled $40,000, of which 90% was direct labor and 10% was indirect labor. d. Used indirect materials, $3,000 e. Incurred other manufacturing overhead for January 2015, $13,000 f. Allocated manufacturing overhead for January 2015 g. Cost of completed motor scooters, $100,000 h. Sold scooters on account, $175,000; cost of scooters sold, $95,000 Requirements: Compute Krazy Kayak's predetermined overhead allocation rate for 2015 Journalize the transactions in the general journal. Adjust the Manufacturing overhead for the overallocated or underallocated overhead. GENERAL JOURNAL POST DATE ACCOUNTS & EXPLANATION REF DEBIT CREDIT