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# Arvelo Corporation

Question 12:

Avery Co. uses a predetermined overhead rate based on direct labor-hours to apply manufacturing overhead to jobs. For the month of October, Avery's estimated manufacturing overhead cost was \$279,000 based on an estimated activity level of 93,000 direct labor-hours. Actual overhead amounted to \$310,000 with actual direct labor-hours totaling 106,000 for the month. How much was the overapplied or underapplied overhead?

\$8,000 overapplied

\$12,000 underapplied

\$12,000 overapplied

\$8,000 underapplied

Question 13:

On November 1, Arvelo Corporation had \$33,000 of raw materials on hand. During the month, the company purchased an additional \$82,000 of raw materials. During November, \$55,000 of raw materials were requisitioned from the storeroom for use in production. These raw materials included both direct and indirect materials. The indirect materials totaled \$4,100.

Prepare journal entries to record these events. Use those journal entries to answer the following questions:

The credits to the Manufacturing Overhead account as a consequence of the raw materials transactions in November total:

\$55,000

\$4,100

\$52,000

\$0

#### Solution Preview

Question 12:

Avery Co. uses a predetermined overhead rate based on direct labor-hours to apply manufacturing overhead to jobs. For the month of October, Avery's estimated manufacturing overhead cost was \$279,000 based on an estimated activity level of 93,000 direct labor-hours. Actual overhead amounted to \$310,000 with actual direct labor-hours totaling 106,000 for the month. How much ...

#### Solution Summary

This solution is comprised of a detailed explanation to answer how much was the overapplied or underapplied overhead and Prepare journal entries.

\$2.19