The following information, taken from the books of Nicholas Company, represents the operations for the month of January:

The job cost system is used, and the February cost sheet for Job M45 shows the following:

The following actual information was accumulated during February:

Required:
1. Using the January data, ascertain the factory overhead application rates to be used during February, based on the following:
a. Direct labor cost
b. Direct labor hours
c. Machine hours
2. Prepare a schedule showing the total production cost of Job M45 under each method of applying factory overhead.
3. Prepare the entries to record the following for February operations:
a. The liability for total factory overhead.
b. Distribution of factory overhead to the departments.
c. Application of factory overhead to the work in process, using direct labor hours. (Use the predetermined rate calculated in 1. and separate applied overhead accounts for each department.)
d. Closing of the applied factory overhead accounts.
e. Recording under- and over-applied factory overhead and closing the actual factory overheadaccounts.

Transcribed Image Text:

Bronzing Casting Finishing Materials used ...$20,000 $10,000 $10,000 Direct labor hours Machine hours .. 1,620 2,025 500 4,000 5,000 Bronzing Casting Finishing $40.00 S60.00 Materials Direct labor Direct labor hours. Machine hours .$20.00 . ..$64.00 $20.00 $54.00 2 Bronzing Casting Finishing 9,800 20,000 . $220,000 $325,000 Factory overhead $350,000