Oddley Corp

question 57

Essay

Oddley Corp.uses a job order costing system.The following is selected information pertaining to costs applied to jobs during the year: Oddley Corp.'s predetermined overhead rate is 60% of direct labor cost.At the end of the year,the company's records show that $189,000 of factory overhead has been incurred.
(a)Determine the amount of overapplied or underapplied overhead.
(b)Prepare the necessary journal entry to close the Factory Overhead account assuming that any remaining balance is not material.

Understand the principles behind the issuance of stock below fair market value and the legal remedies available.

Comprehend the legal defenses available to directors and officers against shareholder action.

Recognize the criteria for corporate formation and the consequences of errors in incorporation documents.

Understand and calculate exchange rates and their effects on currency value.

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Definitions:

IRR

In capital budgeting, the Internal Rate of Return serves as a tool for estimating the potential returns on investment projects.

Investment

The allocation of resources, usually money, into assets or projects expected to generate future returns or profit.

Profitability Index

A calculation that measures the relative profitability of an investment by dividing the present value of future cash flows by the initial investment cost.

Discount Rate

This rate is applied in discounted cash flow analysis to derive the current value of cash flows expected to be received in the future.