marks) This is a short case- your response should include quantitative and qualitative analysis.
Part A: Zellers Canada Itd estimates that annual manufacturing overhead costs will be $500,000. UCW allocates overhead to jobs based on machine hours, and it expects that 300,000 units to be produced and 100,000 machine hours will be required for the year.
• Calculate the predetermined overhead rate.
• Job 153 used a total of 2,000 machine hours to make 4,000 units. Make the journal entry to record manufacturing overhead applied to job 153.
• Assume UCW incurs actual manufacturing overhead costs of $470,000 and applies overhead of $510,000 for the year. Account balances are as follows: WIP inventory, $25,000; finished goods inventory, $25,000; and cost of goods sold, $50,000. Is overhead overapplied or underapplied by how much? Using COGS method, provide journal for the closing of over or underapplied.
7.