Question

Jones Company has an overallocated amount of $2,000 after balancing the Manufacturing Overhead account. The debit entry to close out the overallocated amount would be __________.

Answer 1

Answer:

Explanation:

The journal entry to record the over allocated amount is as follows:

Manufacturing overhead A/c Dr $2,000

            To Cost of Goods sold A/c $2,000

(Being over-applied overhead is recorded)

Since there is an over applied overhead, so we debited the manufacturing overhead and credited the cost of goods sold so that the accurate posting could be done.