Question

Why is it important to adjust Cost of Goods Sold for under/over applied manufacturing overhead? Identify...

Why is it important to adjust Cost of Goods Sold for under/over applied manufacturing overhead?


Identify the four level hierarchy that in which costs are grouped while creating an Activity-Based Costing System. Choose a manufacturing company and identify three types of costs that should be included in each category. 


Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

As per policy, only one question is allowed to answer at time, so answering Q1 here :

Answer 1)

It is always important to adjust the under or over applied manufacturing overhead to the Cost of Goods Sold (COGS) because all jobs/products have to appear in COGS sooner or later. So for simple adjustment of this small part of overhead and for the better use of managerial and accounting time and their efforts it should be adjusted to COGS than going for some other method.

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Which of the following correctly explains what should be done with any under- or over-applied overhead?...
Which of the following correctly explains what should be done with any under- or over-applied overhead? Select one: A. At year end, if there is a significant amount of under- or over-applied overhead, it should be allocated proportionally to Work in Process, Finished Goods, and Cost of Goods sold. B. Monthly, any significant amount of under- or over-applied overhead should be closed to Cost of Goods Sold. C. At year end, if there is a significant amount of under- or...
1) Write off all over or under-allocated overhead to cost of goods sold. BALANCES: Cost of...
1) Write off all over or under-allocated overhead to cost of goods sold. BALANCES: Cost of goods sold 195,220 Manufacturing overhead control 85,060 manufacturing overhead allocated 61,186
Which of the following correctly explains what should be done with any under- or over-applied overhead?...
Which of the following correctly explains what should be done with any under- or over-applied overhead? Monthly, any significant amount of under- or over-applied overhead should be closed to Cost of Goods Sold. At year end, if there is a significant amount of under- or over-applied overhead, it should all be closed to Cost of Goods Sold. At the end of a project, any insignificant under- or over-applied overhead should be closed to Work in Process prior to transferring the...
Under activity-based costing, unit-, batch-, and product-level manufacturing overhead costs are A : excluded from estimates...
Under activity-based costing, unit-, batch-, and product-level manufacturing overhead costs are A : excluded from estimates of product cost.   B : excluded from inventory costing. C : included in selling and administrative costs. D : included in estimates of product cost.
A makes custom furniture and uses a job-order-cost system. The company always writes off under/over applied...
A makes custom furniture and uses a job-order-cost system. The company always writes off under/over applied overhead to cost of goods sold. The following data pertains to the first quarter of 2020: Beginning direct-materials inventory $26,000 Beginning WIP inventory 64,000   Beginning finished-goods inventory 58,000 Direct materials purchased $148,000 Direct materials requisitioned 82,000 Direct-labor cost incurred 120,000 Factory overhead incurred 146,000 Cost of goods completed (COG manufactured) 292,000 Cost of goods sold (before adjustment for under or over-applied overhead) 256,000 Manufacturing...
17. The actual manufacturing overhead incurred at Jeffry Corporation during January was $73,000, while the manufacturing...
17. The actual manufacturing overhead incurred at Jeffry Corporation during January was $73,000, while the manufacturing overhead applied to Work in Process was $78,000. The company's Cost of Goods Sold was $349,000 prior to closing out its Manufacturing Overhead account. The company closes out its Manufacturing Overhead account to Cost of Goods Sold. Which of the following statements is true? a. Manufacturing overhead was overapplied by $5,000; Cost of Goods Sold after closing out the Manufacturing Overhead account is $354,000...
Chang Manufacturing Corporation has a traditional costing system in which it applies manufacturing overhead to its...
Chang Manufacturing Corporation has a traditional costing system in which it applies manufacturing overhead to its products using a predetermined overhead rate based on direct labor-hours (DLHs). The company has two products, Plain and Fancy, about which it has provided the following data: Plain Fancy Direct materials per unit $ 25.40 $ 60.20 Direct labor per unit $ 5.90 $ 29.50 Direct labor-hours per unit 0.30 1.50 Annual production 45,000 15,000 The company's estimated total manufacturing overhead for the year...
Chang Manufacturing Corporation has a traditional costing system in which it applies manufacturing overhead to its...
Chang Manufacturing Corporation has a traditional costing system in which it applies manufacturing overhead to its products using a predetermined overhead rate based on direct labor-hours (DLHs). The company has two products, Plain and Fancy, about which it has provided the following data: Plain Fancy Direct materials per unit $ 24.50 $ 59.30 Direct labor per unit $ 5.00 $ 25.00 Direct labor-hours per unit 0.20 1.00 Annual production 45,000 15,000 The company's estimated total manufacturing overhead for the year...
Terms: overhead application rate manufacturing overhead cost of goods sold cost of finished goods manufactured cost...
Terms: overhead application rate manufacturing overhead cost of goods sold cost of finished goods manufactured cost accounting managerial accounting work in process inventory period costs product costs Each of the following statements may (or may not) describe one of these technical terms. For each statement, indicate the accounting term, described, or answer "None" if the statement does not correctly describe any of the items. a.) a manufacturing cost that can be traced conveniently and directly into manufactured units of product....
1. Job-Order Costing : At the beginning of the year, Creative, Inc. computed its overhead rate...
1. Job-Order Costing : At the beginning of the year, Creative, Inc. computed its overhead rate based on $180,000 of estimated total manufacturing overhead costs for an estimated activity level of 12,000 direct labor-hours. During the year, the company incurred actual manufacturing overhead costs of $195,000 and 9,500 total direct labor-hours. a. What is the company’s predetermined overhead rate? b. What is the amount of manufacturing overhead applied by the company for the period? c. What is the amount of...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT