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Question: The following T-accounts represent November

The following T-accounts represent November activity:
The following T-accounts represent November activity:


Additional Data
• Materials of $113,600 were purchased during the month, and the balance in the Materials Inventory account increased by $11,000.
• Overhead is applied at the rate of 150 percent of direct labor cost.
• Sales are billed at 180 percent of cost of goods sold before the over- or underapplied overhead is prorated.
• The balance in the Finished Goods Inventory account decreased by $28,600 during the month before any proration of under- or overapplied overhead.
• Total credits to the Wages Payable account amounted to $202,000 for direct and indirect labor.
• Factory depreciation totaled $48,200.
• Overhead was underapplied by $25,080. Overhead other than indirect labor, indirect materials, and depreciation was $198,480, which required payment in cash. Underapplied overhead is to be allocated.
• The company has decided to allocate 25 percent of underapplied overhead to Work-in-Process Inventory, 15 percent to Finished Goods Inventory, and the balance to Cost of Goods Sold. Balances shown in T-accounts are before any allocation.

Required
Complete the T-accounts.
Additional Data • Materials of $113,600 were purchased during the month, and the balance in the Materials Inventory account increased by $11,000. • Overhead is applied at the rate of 150 percent of direct labor cost. • Sales are billed at 180 percent of cost of goods sold before the over- or underapplied overhead is prorated. • The balance in the Finished Goods Inventory account decreased by $28,600 during the month before any proration of under- or overapplied overhead. • Total credits to the Wages Payable account amounted to $202,000 for direct and indirect labor. • Factory depreciation totaled $48,200. • Overhead was underapplied by $25,080. Overhead other than indirect labor, indirect materials, and depreciation was $198,480, which required payment in cash. Underapplied overhead is to be allocated. • The company has decided to allocate 25 percent of underapplied overhead to Work-in-Process Inventory, 15 percent to Finished Goods Inventory, and the balance to Cost of Goods Sold. Balances shown in T-accounts are before any allocation. Required Complete the T-accounts.





Transcribed Image Text:

Materials Inventory Work-in-Process Inventory BB (11/1) Dir. Materials 86,200 EB (11/30) 56,400 32,600 Finished Goods Inventory Cost of Goods Sold EB (11/30) 101,000 Manufacturing Overhead Control Applied Manufacturing Overhead 264,000 Wages Payable Sales Revenue 725,400



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2.99

See Answer