Bramble Company purchases $50,500 of raw materials on account, and it incurs $61,400 of factory labor costs. Supporting records show that (a) the Assembly Department used $25,100 of the raw materials and $39,700 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. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Question

Blaine Ali

Business

16 August, 23:09

Bramble Company purchases $50,500 of raw materials on account, and it incurs $61,400 of factory labor costs. Supporting records show that (a) the Assembly Department used $25,100 of the raw materials and $39,700 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. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

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Ana Carney · Answer 1

Work In Process : Assembly Department $63,520 (debit)

Work In Process : Finishing Department $34,720 (debit)

Overhead $98,240 (credit)

Explanation:

Overhead allocations are based on the labor cost. Thus, First determine the amounts of labor costs allocated to the Departments.

Labor Cost Allocation:

Assembly Department = $39,700

Finishing Department = $21,700 that is (61,400 - 39,700)

Overhead Allocation:

Assembly Department ($39,700 * 160%) = $63,520

Finishing Department ($21,700 * 160%) = $34,720