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Recording Inventory Costs [LO 4, 5] Vulcan Molding produces molded rubber components. At the start of the year, the company estimated that it would incur
Recording Inventory Costs [LO 4, 5] Vulcan Molding produces molded rubber components. At the start of the year, the company estimated that it would incur $3,500,000 of direct labor cost and $9,000,000 of manufacturing overhead. Overhead is allocated to production on the basis of direct labor cost. Actual materials used during the year were $5,750,000, actual direct labor cost was $4,000,000, and actual overhead was $11,000,000.
REQUIRED
- a. Calculate the overhead rate for the current year. Round to 2 decimal places.
- b. Prepare the journal entry to record use of direct material.
- c. Prepare the journal entry to record direct labor.
- d. Prepare the journal entry to record manufacturing overhead applied to production.
- e. Prepare the journal entry to close the balance in manufacturing overhead to cost of goods sold.
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