Question

Bergamo Bay's computer system generated the following trial balance on December 31, 2019. The company’s manager...

Bergamo Bay's computer system generated the following trial balance on December 31, 2019. The company’s manager knows something is wrong with the trial balance because it does not show any balance for Work in Process Inventory but does show a balance for the Factory Overhead account. In addition, the accrued factory payroll (Factory Wages Payable) has not been recorded.

Debit Credit
Cash $ 80,000
Accounts receivable 49,000
Raw materials inventory 29,500
Work in process inventory 0
Finished goods inventory 15,000
Prepaid rent 5,000
Accounts payable $ 8,700
Notes payable 11,700
Common stock 50,000
Retained earnings 77,000
Sales 202,100
Cost of goods sold 105,000
Factory overhead 28,000
Operating expenses 38,000
Totals $ 349,500 $ 349,500


After examining various files, the manager identifies the following six source documents that need to be processed to bring the accounting records up to date.

Materials requisition 21-3010: $ 4,700 direct materials to Job 402
Materials requisition 21-3011: $ 7,900 direct materials to Job 404
Materials requisition 21-3012: $ 1,700 indirect materials
Labor time ticket 6052: $ 4,000 direct labor to Job 402
Labor time ticket 6053: $ 16,000 direct labor to Job 404
Labor time ticket 6054: $ 5,000 indirect labor


Jobs 402 and 404 are the only units in process at year-end. The predetermined overhead rate is 100% of direct labor cost.

2-a. Post any entries from part 1 related to factory overhead to the T-account below to determine the amount of under- or overapplied overhead for the year. Determine whether there is any under- or overapplied overhead for the year.
2-b. Prepare the adjusting entry to allocate any over- or underapplied overhead to Cost of Goods Sold, assuming the amount is not material.

Homework Answers

Answer #1
Factory Overheads
Beginning balance 28000 Work in process inventory 20,000
Raw material Inventory 1700 (4000+16000)*100%
Factory wages payable 5000
Ending balance 14,700
As the factory overheads account is having a debit balance of $14,700.
Therefore,
It is Under-applied overheads equal to $14,700.
Journal entry
S.no. Accounts title and explanations Debit $ Credit $
a. Cost of goods sold 14,700
      Factory overheads 14,700
(for closing under-applied overheads)
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Bergamo Bay's computer system generated the following trial balance on December 31, 2017. The company’s manager...
Bergamo Bay's computer system generated the following trial balance on December 31, 2017. The company’s manager knows something is wrong with the trial balance because it does not show any balance for Work in Process Inventory but does show a balance for the Factory Overhead account. In addition, the accrued factory payroll (Factory Payroll Payable) has not been recorded. Debit Credit Cash $ 62,000 Accounts receivable 36,000 Raw materials inventory 23,000 Work in process inventory 0 Finished goods inventory 12,000...
Required information Problem 19-2A Source documents, journal entries, overhead, and financial reports LO P1, P2, P3,...
Required information Problem 19-2A Source documents, journal entries, overhead, and financial reports LO P1, P2, P3, P4 [The following information applies to the questions displayed below.] Bergamo Bay's computer system generated the following trial balance on December 31, 2017. The company’s manager knows something is wrong with the trial balance because it does not show any balance for Work in Process Inventory but does show a balance for the Factory Overhead account. In addition, the accrued factory payroll (Factory Payroll...
Managerial Accounting (ACC 202) Exam 1 Smith & Co. Balance Sheet December 31, 2017 Assets Cash                          
Managerial Accounting (ACC 202) Exam 1 Smith & Co. Balance Sheet December 31, 2017 Assets Cash                                                                                                    $15,000 Accounts Receivable                                                                         22,000 Prepaid Insurance                                                                                  3,000 Material Inventory                                                                                 2,000 WIP inventory                                                                                        2,900 FG inventory                                                                                           1,200 Equipment                                                                                           50,000 (Accum. Dep)                                                                                    (10,000) Total Assets                                                                                       $86,100 Liabilities & Equity Accounts Payable                                                                               $20,000 Wages Payable                                                                                       3,000 Property Taxes Payable                                                                         1,000 Common Stock                                                                                    40,000 Retained Earnings                                                                               22,100 Total Liabilities & Equity                                      ...
Use the following information to answer questions [The following information applies to the questions displayed below.]...
Use the following information to answer questions [The following information applies to the questions displayed below.] The following information is available for Lock-Tite Company, which produces special-order security products and uses a job order costing system. April 30 May 31 Inventories Raw materials $ 32,000 $ 36,000 Work in process 10,000 18,700 Finished goods 65,000 34,100 Activities and information for May Raw materials purchases (paid with cash) 172,000 Factory payroll (paid with cash) 150,000 Factory overhead Indirect materials 10,000 Indirect...
The following information is available for Lock-Tite Company, which produces special-order security products and uses a...
The following information is available for Lock-Tite Company, which produces special-order security products and uses a job order costing system. April 30 May 31 Inventories Raw materials $ 49,000 $ 50,000 Work in process 9,700 18,800 Finished goods 59,000 34,600 Activities and information for May Raw materials purchases (paid with cash) 174,000 Factory payroll (paid with cash) 250,000 Factory overhead Indirect materials 9,000 Indirect labor 57,500 Other overhead costs 109,500 Sales (received in cash) 1,900,000 Predetermined overhead rate based on...
Basil Industries reported the following information for December: Beginning balance, Raw Materials Inventory $187,500 Beginning balance,...
Basil Industries reported the following information for December: Beginning balance, Raw Materials Inventory $187,500 Beginning balance, Work in process Inventory 300,000 Beginning balance, Finished Goods Inventory 106,250 Purchases of raw materials 337,500 Factory electricity 62,500 Direct labor payroll 200,000 Depreciation on factory equipment 218,750 Insurance on factory building 50,000 Indirect materials used in production 43,750 Total raw materials used in production 406,250 Indirect labor payroll 150,000 Cost of goods manufactured 1,250,000 Cost of goods sold 1,312,500 What was the ending...
[The following information applies to the questions displayed below.] The following information is available for Lock-Tite...
[The following information applies to the questions displayed below.] The following information is available for Lock-Tite Company, which produces special-order security products and uses a job order costing system. April 30 May 31 Inventories Raw materials $ 40,000 $ 50,000 Work in process 9,100 18,500 Finished goods 60,000 33,200 Activities and information for May Raw materials purchases (paid with cash) 173,000 Factory payroll (paid with cash) 300,000 Factory overhead Indirect materials 14,000 Indirect labor 69,000 Other overhead costs 96,000 Sales...
Valahan Company manufacturers DumDum bobble heads had the following information for December: a.) The inventory balances...
Valahan Company manufacturers DumDum bobble heads had the following information for December: a.) The inventory balances are: Beginning balance Ending balance Raw materials inventory $ 38,000 $39,000 Work in process inventory 9,700 19,400 Finished goods inventory    69,000 33,800 b.) Raw materials purchased on account amount to $193,000. c.) Material requisitions show that $10,000 of the materials were for indirect use and $182,000 were for direct use. d. ) Factory payroll amounted to $100,000 for the month and time card...
Beckner Inc. is a job-order manufacturer. The company uses a predetermined overhead rate based on direct...
Beckner Inc. is a job-order manufacturer. The company uses a predetermined overhead rate based on direct labor hours to apply overhead to individual jobs. For the current year, estimated direct labor hours are 133,000 and estimated factory overhead is $784,700. The following information is for September. Job X was completed during September, while Job Y was started but not finished. September 1, inventories:     Materials $24,000     Work-in-process (All Job X) 53,400     Finished goods 105,600 Materials purchases $157,000 Direct materials requisitioned:     Job...
The following information is available for Lock-Tite Company, which produces special-order security products and uses a...
The following information is available for Lock-Tite Company, which produces special-order security products and uses a job order costing system. April 30 May 31 Inventories Raw materials $ 28,000 $ 33,000 Work in process 9,700 20,500 Finished goods 68,000 34,400 Activities and information for May Raw materials purchases (paid with cash) 180,000 Factory payroll (paid with cash) 150,000 Factory overhead Indirect materials 12,000 Indirect labor 34,500 Other overhead costs 98,000 Sales (received in cash) 1,600,000 Predetermined overhead rate based on...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT
Active Questions
  • On January 1, the Office Supplies account had a $600 balance. On December 31 (end of...
    asked 17 seconds ago
  • On October 1, 2021, Monty Corp. issued $828,000, 7%, 10-year bonds at face value. The bonds...
    asked 17 seconds ago
  • A 48 kg ice skater is gliding along the ice, heading due north at 5.0 m/s....
    asked 17 seconds ago
  • Which of the following statements is FALSE about product liability suits brought in strict liability? Most...
    asked 3 minutes ago
  • A banker contemplating a loan to a company should focus on which section(s) of the cash...
    asked 4 minutes ago
  • Q1) FalmouthFalmouth Pools manufactures swimming pool equipment. FalmouthFalmouth estimates total manufacturing overhead costs next year to...
    asked 5 minutes ago
  • A multinational engineering consulting firm that wants to provide resort accommodations to special clients is considering...
    asked 8 minutes ago
  • Finney Corporation is authorized to issue 1,000,000 shares of $2 par value common stock. During 2005,...
    asked 12 minutes ago
  • For its first 8 years, Facebook, Inc., operated as a privately held corporation. The company had...
    asked 13 minutes ago
  • 2. A drunk starts out from a lamppost in the middle of a street. Suppose that...
    asked 17 minutes ago
  • 3. Bakerston Company is a manufacturing firm that uses job-order costing. The company's inventory balances were...
    asked 22 minutes ago
  • Provided no other information and an efficient market, the CAR five days before a dividend announcement...
    asked 23 minutes ago