Explore BrainMass

Explore BrainMass

    Rodriquez Company Manufacturing overhead rates, under and over applied

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    Rodriquez Company applies manufacturing overhead to jobs on the basis of machine hours used. Overhead costs are expected to total $300,000 for the year, and machine usage is estimated at 125,000 hours.

    For the year, $322,000 of overhead costs are incurred and 130,000 hours are used.

    Instructions:
    (a) Compute the manufacturing overhead rate for the year.
    (b) What is the amount of under- or overapplied overhead at December 31?
    (c) Assuming the under- or overapplied overhead for the year is not allocated to inventory accounts, prepare the adjusting entry to assign the amount to cost of goods sold.

    © BrainMass Inc. brainmass.com June 3, 2020, 6:25 pm ad1c9bdddf
    https://brainmass.com/business/accounting/rodriquez-company-manufacturing-overhead-rates-under-and-over-applied-59479

    Attachments

    Solution Preview

    (a) Compute the manufacturing overhead rate for the year.
    =Overhead cost / machine usage = 300,000/125,000= $2.40 per machine hour

    (b) What is the amount of under- or overapplied ...

    Solution Summary

    The solution shows the calculations with explanations to arrive at the answers.

    $2.19

    ADVERTISEMENT