36) When actual costs are not known until the end of the month, an estimated application rate should be determined so that the total weekly costs can be applied.


37) One way to determine an overhead application rate is to divide estimated annual overhead by estimated annual direct labor dollars.


38) Record in general journal form the following transactions for Marble Manufacturing:


Feb. 4Raw materials of $7,500 were issued from the storeroom.


Feb. 7Charged $18,000 of direct labor to production.


Feb. 10Supplies costing $5,300 were issued from the storeroom.


Feb. 15The following expenses were charged to overhead: depreciation $4,000, rent $3,000, and electricity $2,000.


Feb. 20Overhead was applied at 80% of direct labor dollars.


Feb. 21Transferred completed goods costing $5,000 to finished goods.

39) From the following transactions, prepare the appropriate general journal entries for the month of April.


a. Raw materials costing $60,000 were issued from the storeroom.

b. Direct labor of $53,000 was charged to production.

c. Indirect labor costs of $17,000 were incurred.

d. Overhead was applied at the rate of 40% of direct labor dollars.

e. Completed products costing $42,000 were transferred to finished goods.

f. Products costing $32,000 were sold.


40) The following data are available for Convoy Trucks:


Estimated machine hours40,000 hours

Actual machine hours5,000 hours

Estimated manufacturing overhead$125,000

Actual manufacturing overhead13,000



a. Compute the predetermined overhead rate assuming the rate is based on machine hours.

b. Prepare the journal entry to record the applied overhead.



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