The manufacturing records for Sporty Kayaks at the end of the 2018 fiscal year show the following information about manufacturing overhead:
Overhead allocated to production
Actual manufacturing overhead cost
Predetermined overhead allocation rate
$44 per machine hours
2. Was manufacturing overhead overallocated or underallocated for the year, and by how much?
The underallocated overhead for the year is $22,800
Machine hours is a measurement which is used to apply the manufacturing overhead to the manufactured goods of the company.
Comparing actual to allocated overhead
Columbus Enterprises reports the following information at December 31, 2018:
2. What is the allocated manufacturing overhead?
Jordan Company has the following information for the year ended December 31, 2018. Use the information to prepare a schedule of cost of goods manufactured and an income statement. Assume no indirect materials are used and all amounts are shown in millions.
Selling and administrative expenses
Manufacturing overhead; actual and allocated
Direct materials used
For the following accounts, indicate what causes the account to increase and decrease. The first account is completed as an example.
Is increased by:
Is decreased by:
Raw material inventory
Work in process inventory
Finished goods inventory
Cost of goods sold
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