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SB ( Algo ) Patel and Sons . . . [ The following information applies to the questions displayed below. ] Patel and Sons Incorporated
SB Algo Patel and Sons
The following information applies to the questions displayed below.
Patel and Sons Incorporated uses a standard cost system to apply factory overhead costs to units produced. Practical
capacity for the plant is defined as machine hours per year, which represents units of output. Annual
budgeted fixed factory overhead costs are $ and the budgeted variable factory overhead cost rate is $ per
unit. Factory overhead costs are applied on the basis of standard machine hours allowed for units produced. Budgeted
and actual output for the year was units, which took machine hours. Actual fixed factory overhead costs for
the year amounted to $ while the actual variable overhead cost per unit was $
Brief Exercise Algo Assume that at the end of the year, management of Patel... LO
Assume that at the end of the year, management of Patel and Sons decides that the overhead cost variances should be allocated to
WIP Inventory, Finished Goods Inventory, and Cost of Goods Sold CGS using the following percentages: and
respectively. Provide the proper journal entry to close out the manufacturing overhead variances for the year.
Note: Do not round intermediate calculations. Round your final answers to nearest whole dollar amount. If no entry is required for
a transaction or event, select No journal entry required" in the first account field.
Journal entry worksheet
Record the entry to close the variance accounts to Work in process inventory,
Finished goods inventory, and Cost of goods sold.
Note: Enter debits before credits.
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