Predetermined Overhead Rates Variances, Cash Flows (LO 2.4.5) Playmore Costume Company located in To

Predetermined Overhead Rates Variances, Cash Flows (LO 2.4.5) Playmore Costume Company located in To

Predetermined Overhead Rates Variances, Cash Flows (LO 2.4.5) Playmore Costume Company located in Toronto, se costumes for plays and Playmore considers self primarily a service firm, as it never produces costumes without a pre-existing order and only purchases materials to the specifications of the particular job. Any finished goods anding inventory is temporary and is zorged out as soon as the show producer pays for the order Overhead is applied on the basis of direct labour cost. During the first quarter of the year, the following activity took place in each of the accounts lists: Work in Process Bal. 17.000 I Complete 245.000 DL 80.0001 OH 140 0001 DM 40.0001 Bal. 32.000 210,000 Finished Goods Bal 40,000 Sold Complete 245.000 75.000 1315001140.000 Bal 1.500 Cost of Goods Sold 210.0001 Job 32 was the only job in process at the end of the quarter. A total of 1,000 direct labour at $10 per hour were charged to Job 32 Required: 1. Assuming the overhead is applied on the basis of direct labour cost, what was the overhead rate used during the first quarter of the year? 2. What was the applied overhead for the first quarter? The actual overhead? The under-applied or over-applied overhead? 3. What was the cost of the goods manufactured for the quarter? 4. Assume that the overhead variance is closed to the Cost of Goods sold account Prepare the journal entry to close out the Overhead Control Account What is the adjusted balance in Cost of Goods Sold? 5. For Job 32. identify the costs incurred for direct materials, direct labour, and overhead

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