Exercise 15-5 Ikerd Company applies manufacturing overhead to jobs on the basis of machine hours used.

  

Exercise 15-5

Ikerd Company applies manufacturing overhead to jobs on the basis of machine hours used. Overhead costs are expected to total $292,552 for the year, and machine usage is estimated at 126,100 hours.
 

For the year, $399,060 of overhead costs are incurred and 130,500 hours are used.

  

Compute the manufacturing overhead rate for the year. (Round answer to 2 decimal places, e.g. 1.52.)

  

Manufacturing   overhead rate

$

per   machine hour

    

  

SHOW LIST   OF ACCOUNTS

 

  

What is the amount of under- or overapplied overhead at December 31?

  

Manufacturing   Overhead

$

UnderappliedOverapplied

    

  

SHOW LIST   OF ACCOUNTS

  

Prepare the adjusting entry to assign the under- or overapplied overhead for the year to cost of goods sold. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

  

Account Titles and   Explanation

Debit

Credit