Hou Company Applies Factory Overhead to Its Production Departments on the Basis

question 95

Short Answer

Hou Company applies factory overhead to its production departments on the basis of 90% of direct labor costs.In the Assembly Department, Hou had $125,000 of direct labor cost, and in the Finishing Department, Hou had $35,000 of direct labor cost.The entry to apply overhead to these production departments is:

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Definitions:

Industry Growth

The increase in production, sales, and the number of companies in a specific sector over time, indicating economic expansion and market potential.

Geographic Scope

Refers to the physical area in which a company operates or targets for its business activities.

Value Chain Activities

The range of activities that a business performs to deliver a valuable product or service to its customers, including both primary and support activities.

Available Technology

Refers to the current technologies that are accessible for use in various industries to enhance operations, products, or services.