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Warner Company purchases $50,100 of raw materials on account, and it incurs $61,000 of factory labor costs. Supporting records show that (a) the Assembly Department used $24,100 of the raw materials and $36,000 of the factory labor, and (b) the Finishing Department used the remainder. Manufacturing overhead is assigned to departments on the basis of 160% of labor costs.
Journalize the assignment of overhead to the Assembly and Finishing Departments.
Account Titles and Explanation Debit Credit

Sagot :

Tundexiidn

Answer:

Date   Account Titles and Explanation        Debit         Credit

           WIP - Assembly department             $57,600

           WIP - Finishing department               $40,000

                    Manufacturing overhead                             $97,600

           (To assign overheads to assembly and finishing department)

Explanation:

Labor cost assigned to assembly = $36,000

Labor cost assigned to finishing = $61,000 - $36,000 = $25000

Manufacturing cost assigned to assembly = $36,000 *160% = $57600

Manufacturing cost assigned to finishing = $25000 * 160% = $40000

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