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5 January, 22:35

EA12.

LO 4.7During the month, Job AB2 used specialized machinery for 450 hours and incurred $500 in utilities on account, $300 in factory depreciation expense, and $100 in property tax on the factory. Prepare journal entries for the following:

Record the expenses incurred.

Record the allocation of overhead at the predetermined rate of $1.50 per machine hour.

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  1. 5 January, 22:50
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    The Journal entries are as follows:

    (i) Manufacturing Overheads Account Dr. $900

    To Accumulated Depreciation $300

    To Cash account $100

    To Utilities payable $500

    (To record the expenses incurred)

    (ii) Work in process inventory A/c ($1.50 * 450) Dr. $675

    To Manufacturing Overhead $675

    (To record the allocation of overhead at the predetermined rate of $1.50 per machine hour)
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