Allocating manufacturing overhead
The manufacturing records for Krazy Kayaks at the end of the 2012 fiscal year show the following information about manufacturing overhead:
|
Overhead allocated to production . |
$ 405,900 |
|
Actual manufacturing overhead costs |
$ 428,000 |
|
Overhead allocation rate for the year |
$ 41 per machine hour |
Requirements
1. How many machine hours did Krazy Kayaks use in 2012?
2. Was manufacturing overhead over- or underallocated for the year and by how much?
3. Prepare the journal entry to close out the over- or underallocated overhead.