Question
What is the factory overhead cost? Bergamo Bay's computer system generated the following trial balance on December 31, 2017. The company's manager knows something is
What is the factory overhead cost?
Bergamo Bay's computer system generated the following trial balance on December 31, 2017. The company's manager knows something is wrong with the trial balance because it does not show any balance for Work in Process Inventory but does show a balance for the Factory Overhead account. In addition, the accrued factory payroll (Factory Payroll Payable) has not been recorded.
Debit Credit
Cash $ 70,000
Accounts receivable 46,000
Raw materials inventory 28,000
Work in process inventory 0
Finished goods inventory 9,000
Prepaid rent 3,000
Accounts payable $ 11,700
Notes payable 14,700
Common stock 30,000
Retained earnings 89,000
Sales 192,600
Cost of goods sold 112,000
Factory overhead 25,000
Operating expenses 45,000
Totals $ 338,000 $ 338,000
________________________________________
After examining various files, the manager identifies the following six source documents that need to be processed to bring the accounting records up to date.
Materials requisition 21-3010: $ 4,800 direct materials to Job 402
Materials requisition 21-3011: $ 7,900 direct materials to Job 404
Materials requisition 21-3012: $ 2,000 indirect materials
Labor time ticket 6052: $ 2,000 direct labor to Job 402
Labor time ticket 6053: $ 13,000 direct labor to Job 404
Labor time ticket 6054: $ 3,000 indirect labor
________________________________________
Jobs 402 and 404 are the only units in process at year-end. The predetermined overhead rate is 150% of direct labor cost.
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