Embark produces mulch for landscaping use. The following information summarizes production operations for June. The journal entry to record June production activities for overhead allocation is:

Question

Quizplus · Accepted Answer

Overhead costs are allocated to goods in process using a predetermined rate. The journal entry to record June production activities for overhead allocation would involve debiting goods in process inventory for the total overhead costs allocated to production (in this case, $248,000) and crediting factory overhead for the same amount. This entry reflects the transfer of overhead costs from the factory overhead account to the goods in process inventory account.

Embark Produces Mulch for Landscaping Use