Question

1.Centore Inc. has provided the following data for the month of June. There were no beginning inventories; consequently, the direct materials, direct labor, and manufacturing overhead applied listed below are all for the current month.

	Work In Process			Finished Goods			Cost of Goods Sold			Total
Direct materials	$	650		$	7,590		$	24,860		$	33,100
Direct labor		2,180			20,700			67,800			90,680
Manufacturing overhead applied		930			7,130			22,940			31,000
Total	$	3,760		$	35,420		$	115,600		$	154,780

Manufacturing overhead for the month was underapplied by $3,000.

The company allocates any underapplied or overapplied manufacturing overhead among work in process, finished goods, and cost of goods sold at the end of the month on the basis of the overhead applied during the month in those accounts.

The work in process inventory at the end of June after allocation of any underapplied or overapplied manufacturing overhead for the month is closest to:

2.

Bosshart Inc. has provided the following data for the month of May. There were no beginning inventories; consequently, the direct materials, direct labor, and manufacturing overhead applied listed below are all for the current month.

	Work In Process			Finished Goods			Cost of Goods Sold			Total
Direct materials	$	10,670		$	12,000		$	81,120		$	103,790
Direct labor		11,630			15,000			101,400			128,030
Manufacturing overhead applied		9,680			9,680			68,640			88,000
Total	$	31,980		$	36,680		$	251,160		$	319,820

Manufacturing overhead for the month was underapplied by $6,000.

The Corporation allocates any underapplied or overapplied manufacturing overhead among work in process, finished goods, and cost of goods sold at the end of the month on the basis of the manufacturing overhead applied during the month in those accounts.

The journal entry to record the allocation of any underapplied or overapplied manufacturing overhead for May would include credit or debit to Work in Process of how much?

Answer 1

• All working forms part of the answer
• Requirement 1
• Working for allocation and allocation of underapplied

	Total	Work in Progress	Finished Goods	Cost of Goods Sold
Manufacturing overhead applied (A)	31000	930	7130	22940
% of total (B)	100%	3%	23%	74%
Underapplied overhead	3000	[3000 x 3%] 90	[3000 x 23%] 690	[3000 x 74%] 2220

	Work in Progress	Finished Goods	Cost of Goods Sold	Total
Direct Materials	650	7590	24860	33100
Direct Labor	2180	20700	67800	90680
Manufacturing Overhead applied	930	7130	22940	31000
Underapplied	90	690	2220	3000
TOTAL	3850	36110	117820	157780

-----The Answer is the work in progress inventory at the end of May after allocation of Underapplied overhead would be $3850

• Requirement 2

Working ------------------

	Total	Work in Progress	Finished Goods	Cost of Goods Sold
Manufacturing overhead applied	88000	9680	9680	68640
% of total	100%	11%	11%	78%
Underapplied overhead	6000	660	660	4680
	Work in Progress	Finished Goods	Cost of Goods Sold	Total
Direct Materials	10670	12000	81120	103790
Direct Labor	11630	15000	101400	128030
Manufacturing Overhead applied	9680	9680	68640	88000
Underapplied	660	660	4680	6000
TOTAL	32640	37340	255840	325820

---Since the overhead were UNDER applied, the journal entry would be:

Work In progress Dr $660
manufacturing Overhead $660

Hence, the answer is Work in Progress will be DEBITED by $660