Centore Inc has provided the following data for the month of

Centore Inc. has provided the following data for the month of June. There were no beginning inventories; consequently, the direct materials, direct labor, and manufacturing overhead applied listed below are all for the current month Cost of Goods Sold 24,8 60 67,8 Work In Process Finished Goods 7,59 Total 33,1 Direct materials $650 0 90,6 80 31,0 2,1 20,7 7,13 35,4 Direct labor 80 930 3,7 22,9 40 115, 600 Manufacturing overhead applied 154, 780 Total 60 20 Manufacturing overhead for the month was underapplied by $3,000 The company allocates any underapplied or overapplied manufacturing overhead among work in process, finished goods, and cost of goods sold at the end of the month on the basis of the overhead applied during the month in those accounts The journal entry to record the allocation of any underapplied or overapplied manufacturing overhead for June would include the following

Solution

Journal entry :

Ratio of allocation =

Work in process = 930*100/31000 = 3%

Finished goods = 7130*100/31000 = 23%

Cost of goods sold = 22940*100/31000 = 74%

Date	accounts & explanation	debit	credit
	Work in process a/c (3000*3%)	90
	Finished goods a/c (3000*23%)	690
	Cost of goods sold a/c (3000*74%)	2220
	Manufacturing overhead a/c		3000
	(To record allocate under applied overhead)