Morewell Inc

question 106

Essay

Morewell Inc.has two processes-Coloring Department and Mixing Department.The company sold 450 gallons on account at $110 per gallon.The total cost of processing was $385,000 for 5,500 gallons of paint.Throughout the year,The company used a predetermined overhead allocation rate to allocate $80,000 and $90,000 of indirect costs to the Coloring Department and Mixing Department,respectively.The actual overhead costs incurred amounted to $150,000 at the end of the year.What are the journal entries to record the sale of goods and the adjustment for over/underallocated manufacturing overhead at the end of the year if the company follows a process costing system?

---

Definitions:

FDA Approval

FDA Approval is the authorization granted by the U.S. Food and Drug Administration for a drug, medical device, or food product to be marketed or sold after meeting safety and efficacy standards.

Terminal Value

The value of an investment at the end of a specified period, often used in discounted cash flow analysis to estimate future cash flows beyond a forecast period.

Market Potential

An estimate of the maximum total sales of a product or service in a particular market over a specified period under ideal conditions.

Rollback Value

A term not typically used in standard statistical or mathematical language; likely specific to certain decision analysis contexts. NO.