Winston Company estimates that the factory overhead for the following year will be $1,250,000. The company has decided that the basis for applying factory overhead should be machine hours, which is estimated to be 50,000 hours. The total machine hours for the year were 54,300. The actual factory overhead for the year was $1,348,800.
a. Determine the total factory overhead amount applied.
b. Compute the over- or underapplied amount for the year.
c. Journalize the entry to transfer the over- or underapplied factory overhead to cost of goods sold.

Question

Winston Company estimates that the factory overhead for the following year will be $1,250,000. The company has decided that the basis for applying factory overhead should be machine hours, which is estimated to be 50,000 hours. The total machine hours for the year were 54,300. The actual factory overhead for the year was $1,348,800.​
a. Determine the total factory overhead amount applied.
b. Compute the over- or underapplied amount for the year.
c. Journalize the entry to transfer the over- or underapplied factory overhead to cost of goods sold.

Quizplus · Accepted Answer

The Answer of Winston Company estimates that the factory overhead for the following year will be $1,250,000. The company has decided that the basis for applying factory overhead should be machine hours, which is estimated to be 50,000 hours. The total machine hours for the year were 54,300. The actual factory overhead for the year was $1,348,800.​
a. Determine the total factory overhead amount applied.
b. Compute the over- or underapplied amount for the year.
c. Journalize the entry to transfer the over- or underapplied factory overhead to cost of goods sold.

Winston Company Estimates That the Factory Overhead for the Following