LO.2 (Predetermined OH rates and underapplied/overapplied OH) Davidson's Dolls had the following information in its Work in Process Inventory account for June 2010: Work in Process Inventory Beginning balance 10,000 Transferred out 335,000 Materials added 150,000 Labor (5,000 DLHS) 90,000 Applied overhead 120,000 Ending balance 35,000 All workers are paid the same rate per hour. Factory overhead is applied to Work in Process Inventory on the basis of direct labor hours. The only work left in process at the end of the month had a total of 2,860 direct labor hours accumulated to date. a. What is the total predetermined OH rate per direct labor hour? b. If actual total overhead for June is $121,500, what is the amount of underapplied or overapplied overhead? c. Given your answer to part (b), how would you recommend the over- or underap- plied overhead be closed?

LO.2 (Predetermined OH rates and underapplied/overapplied OH) Davidson's Dolls had the following information in its Work in Process Inventory account for June 2010: Work in Process Inventory Beginning balance 10,000 Transferred out 335,000 Materials added 150,000 Labor (5,000 DLHS) 90,000 Applied overhead 120,000 Ending balance 35,000 All workers are paid the same rate per hour. Factory overhead is applied to Work in Process Inventory on the basis of direct labor hours. The only work left in process at the end of the month had a total of 2,860 direct labor hours accumulated to date. a. What is the total predetermined OH rate per direct labor hour? b. If actual total overhead for June is $121,500, what is the amount of underapplied or overapplied overhead? c. Given your answer to part (b), how would you recommend the over- or underap- plied overhead be closed?

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter3: Process Cost Systems

Section: Chapter Questions

Problem 12E: a. Based on the data in Exercise 17-11, determine the following: 1. Cost of beginning work in...

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