Wang Company provides the following data for the current year:Estimated Factory Overhead$7,800Factory Overhead Incurred$11,400Factory Overhead Applied?Estimated Direct Labor Cost$12,000Direct Labor Cost Incurred$11,800Required:a. Calculate the predetermined overhead allocation rate based on direct labor.b. Determine the amount of overhead applied to production.c. Prepare the journal entry to apply factory overhead to Work in Process.

What will be an ideal response?


(a)$7,800/$12,000= 65% of Direct Labor Cost
(b) $11,800 ? 65% = $7,670 overhead applied

(c) Work in Process Inventory………………………7,670
  Factory Overhead……………………………. 7,670

Business

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