Required information The following information applies to th

Required information [The following information applies to the questions displayed below.] Bodin Company manufactures finger splints for kids who get tendonitis from playing video games. The firm had the following inventories at the beginning and end of the month of January Finished goods Work in process Raw material January 1 125,000 233,000 132,000 January 31 117,000 251,000 124,000 The following additional data pertain to January operations Raw material purchased Direct labor Actual manufacturing overhead Actual selling and administrative expenses $190,000 350,000 170,000 115,000 The company applies manufacturing overhead at the rate of 60 percent of direct-labor cost. Any overapplied or underapplied manufacturing overhead is accumulated until the end of the year. 5. Compute the balance in the manufacturing overhead account on January 31. Debit or credit? anufacturing overhead account balance on January 31 is

Solution

Manufacturing overhead applied = 350000*60%= 210000 Overapplied manufacturing overhead = 210000-170000 = 40000 Manufacturing account balance is $40000 Credit