Here is some basic data for Delta Manufacturing: Cost of materials purchases on account $ 77,000 Cost of materials requisitioned (includes $2,000 of indirect) 45,000 Direct labor costs incurred 80,000 Manufacturing overhead costs incurred, including indirect materials 98,000 Cost of goods completed 276,600 Cost of goods sold 149,000 Beginning raw materials inventory 19,000 Beginning work in process inventory 35,000 Beginning finished goods inventory 25,000 Predetermined manufacturing overhead rate (as % of direct labor cost) 120% The journal entry to record actual manufacturing overhead costs includes a

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Business

Clare Rogers

6 June, 02:30

Here is some basic data for Delta Manufacturing: Cost of materials purchases on account $ 77,000 Cost of materials requisitioned (includes $2,000 of indirect) 45,000 Direct labor costs incurred 80,000 Manufacturing overhead costs incurred, including indirect materials 98,000 Cost of goods completed 276,600 Cost of goods sold 149,000 Beginning raw materials inventory 19,000 Beginning work in process inventory 35,000 Beginning finished goods inventory 25,000 Predetermined manufacturing overhead rate (as % of direct labor cost) 120% The journal entry to record actual manufacturing overhead costs includes a

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Gaven · Answer 1

Overheads $498,000 (debit)

Cash $498,000 (credit)

Explanation:

First calculate the Amount of Actual overhead incurred (overheads are indirect manufacturing costs)

Manufacturing overheads incurred = $498,000

Journal Entry

Overheads $498,000 (debit)

Cash $498,000 (credit)

This journal is different from that of recording applied overheads which is shown as follows:

Work - In - Process $ 96,000 (debit)

Overheads $ 96,000 (credit)

Overheads amount = 80,000 * 120% = $ 96,000