Enter the overhead costs incurred and the amounts applied during the year using the
predetermined overhead rate and determine whether overhead is overapplied or underapplied.
Overhead applied to jobs = 190% × $478,000 = $908,200
Prepare the adjusting entry to allocate any over- or underapplied overhead to Cost of Goods Sold.
Cost of goods sold
[The following information applies to the questions displayed below.]
In December 2014, Infodeo established its predetermined overhead rate for movies produced during
year 2015 by using the following cost predictions: overhead costs, $1,728,000,and direct labor costs,
$480,000. At year-end 2015, the company’s records show that actual overhead costs for the year are
$1,950,700. Actual direct labor cost had been assigned to jobs as follows.