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Dream Makers is a small manufacturer of gold and platinum jewelry. It uses a job costing system that applies overhead on the basis of direct labor hours. Budgeted factory overhead for the year was $540,000, and management budgeted 37,500 direct labor-hours. The company had no Materials, Work-in-Process, or Finished Goods Inventory at the beginning of April. These transactions were recorded during April:

1. April insurance cost for the manufacturing property and equipment was $2,200. The premium had been paid in January.
2. Recorded $1,305 depreciation on an administrative asset.
3. Purchased 21 pounds of high-grade polishing materials at $16 per pound (indirect materials).
4. Paid factory utility bill, $6,830, in cash.
5. Incurred 4,000 hours and paid payroll costs of $160,000. Of this amount, 1,000 hours and $20,000 were indirect labor costs.
6. Incurred and paid other factory overhead costs, $6,510.
7. Purchased $28,500 of materials. Direct materials included unpolished semiprecious stones and gold. Indirect materials included supplies and polishing materials.
8. Requisitioned $22,500 of direct materials and $2,400 of indirect materials from Materials Inventory.
9. Incurred miscellaneous selling and administrative expenses, $6,780.
10. Incurred $4,345 depreciation on manufacturing equipment for April.
11. Paid advertising expenses in cash, $3,250.
12. Applied factory overhead to production on the basis of direct labor hours.
13. Completed goods costing $68,000 during the month.
14. Made sales on account in April, $67,090. The Cost of Goods Sold was $54,580.

Required:

1. Compute the firms predetermined factory overhead rate for the year.

2. Prepare journal entries to record the April events.

3. Calculate the amount of overapplied or underapplied overhead on April 30.

4. Prepare a schedule of Cost of Goods Manufactured and a schedule of Cost of Goods Sold.

5. Compute the amount of overapplied or underapplied overhead that should be prorated to Work-in-Process, Finished Goods, and Cost of Goods Sold.

5. Prepare the income statement for April.

I Need Number 5 and 6 solved please.

1) Predetermined factory overhead rate = Budgeted factory overhead / Budgeted Direct labor hours $ 540000 / 37500 $ 14.40 per direct labor hour 2) Journal Entries Event Particulars Debit Credit 1) $ 2,200.00 Factory Overhead Prepaid Insurance $ 2,200.00 2) $ 1,305.00 Depreciation Expense Accumulated Depreciation $ 1,305.00 3) $ 336.00 Materials Inventory Accounts Payable (21 pounds x $ 16 per pound) $ 336.00 4) $ 6,830.00 Factory Overhead Cash $ 6,830.00 5) Work in Process Factory Overhead To Wages Payable $140,000.00 $ 20,000.00 $160,000.00 6) $ 6,510.00 Factory Overhead Cash $ 6,510.00 7) $ 28,500.00 Materials Inventory Accounts Payable $ 28,500.00 Event Particulars Debit Credit 8) Work in Process Factory Overhead Materials Inventory $22,500.00 $ 2,400.00 $24,900.00 9) $ 6,780.00 Selling and Adm. Expenses To Accounts Payable $ 6,780.00 10) $ 4,345.00 Factory Overhead Accumulated Depreciation $ 4,345.00 11) $ 3,250.00 Advertising Expense Cash $ 3,250.00 12) $43,200.00 Work in Process Factory Overhead (3000 hours x $ 14.4) $43,200.00 13) $68,000.00 Finished Goods Work in Process $68,000.00 14) $ 67,090.00 Accounts Receivable Sales $67,090.00 $54,580.00 Cost of Goods Sold Finished Goods $54,580.00 3) Computation of overapplied or underapplied overhead Actual factory overhead incurred: Indirect materials $ 2,400.00 Indirect labor $20,000.00 Insurance cost for the manufacturing property and equipment $ 2,200.00 Factory utility bill $ 6,830.00 Other factory overhead costs $ 6,510.00 Depreciation on manufacturing equipment $ 4,345.00 Actual factory overhead incurred $42,285.00 Factory overhead applied $43,200.00 Overapplied overhead $ 915.00 4) Schedule of Cost of Goods Manufactured Direct materials Direct labor Overhead applied Total manufacturing costs incurred during year Work in Process, Beginning Total manufacturing cost to account for Work in Process, Ending Cost of Goods manufactured $ 22,500.00 $140,000.00 $ 43,200.00 $ 205,700.00 $ $205,700.00 $137,700.00 $ 68,000.00 Schedule of Cost of Goods Sold Finished Goods Inventory, Beginning Cost of Goods manufactured Total Cost of Goods Available for Sale Finished Goods Inventory, Ending Cost of Goods Sold Overapplied overhead Adjusted Cost of Goods Sold $ $ 68,000.00 $ 68,000.00 $ 13,420.00 $ 54,580.00 $ 915.00 $53,665.00

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