The Brass Works Is in the Process of Determining Manufacturing

question 27

Short Answer

The Brass Works is in the process of determining manufacturing overhead. Journalize events (a) - (d) to Factory Overhead, Administrative Expenses, Selling expenses, or allocated between the three as appropriate. All items were paid in cash at the time of acquisition.  Next calculate the overhead application rate and apply overhead to Work in Process.
(a) Brass Works purchases an insurance policy for $4,000. It is computed that 80% of the value of the policy protects production, the balance protects the administrative offices. brass Works charges insurance initially to expense.
(b) The electric bill is received showing an amount due of $1,200. This meter is utilized only by production as the office spaces have their own meter.
(c) Payroll reports that the sales manager's salary for the period is $3,500 and that production supervisors wages for the period are $5,500.
(d) The stockroom reports that $2,575 in materials were purchased for the production Maintenance Department.
(e) If the driver for the application of overhead is drop-forge strokes and there are expected to be 1,000 strokes in this period, what is the rate per stroke? Do not round your answer.
(f) Assuming that there are 1,150 drop-forge strokes in this period, apply factory overhead to Work in Process. Round your answers to nearest dollar.
Round overhead rate to four decimal places and total cost to nearest dollar.

---

Definitions:

Internal Controls

Processes and procedures implemented by a business to safeguard assets, enhance accuracy of financial records, and increase efficiency.

Payroll

Payroll refers to the process by which employers pay an employee for the work they have completed during a certain period of time.

Social Security

A government system that provides monetary assistance to people with an inadequate or no income.

Medicare

A federal health insurance program primarily for people aged 65 and older, but also available to some younger people with disabilities.