A company uses an integrated accounting system and absorbs production overhead using a predetermined rate of $6 per machine hour.
Last period a total of 25,500 machine hours were worked and the actual production overhead incurred was $158,000.
The accounting entries for the absorption of production overhead for the period would be:
- Debit: production overhead control account $158,000 Credit: work in progress control account $158,000
- Debit: production overhead control account $153,000 Credit: work in progress control account $153,000
- Debit: work in progress control account $158,000 Credit: production overhead control account $158,000
- Debit: work in progress control account $153,000 Credit: production overhead control account $153,000
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