Estimates made for a production department of the Automate Company for the month of October show: Factory overhead is applied on the basis of direct labor hours. On October 31, the records show these actual figures: Prepare the entry or entries to 1) apply factory overhead to production; 2) record actual factory overhead incurred assuming all items were purchased from vendors; 3) close out the two factory overhead account balances to set up the overapplied or underapplied factory overhead; and 4) to close the balance in under- or overapplied factory overhead to Cost of Goods Sold.

Question

Estimates made for a production department of the Automate Company for the month of October show:  Factory overhead is applied on the basis of direct labor hours. On October 31, the records show these actual figures:  Prepare the entry or entries to 1) apply factory overhead to production; 2) record actual factory overhead incurred assuming all items were purchased from vendors; 3) close out the two factory overhead account balances to set up the overapplied or underapplied factory overhead; and 4) to close the balance in under- or overapplied factory overhead to Cost of Goods Sold.

Quizplus · Accepted Answer

The Answer of Estimates made for a production department of the Automate Company for the month of October show:  Factory overhead is applied on the basis of direct labor hours. On October 31, the records show these actual figures:  Prepare the entry or entries to 1) apply factory overhead to production; 2) record actual factory overhead incurred assuming all items were purchased from vendors; 3) close out the two factory overhead account balances to set up the overapplied or underapplied factory overhead; and 4) to close the balance in under- or overapplied factory overhead to Cost of Goods Sold.

Estimates Made for a Production Department of the Automate Company