Chapter 15: Q9E (page 698)
Use information in Exercise 15-7 to prepare journal entries for the following events for the month of May.
Work-in-process is debited with$265,000
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A company’s Factory Overhead account shows total debits of \(624,000 and total credits of \)646,000 at the end of the year. Prepare the journal entry to close the balance in the Factory Overhead account to Cost of Goods Sold.
Question: In a job order costing system, what records serve as a subsidiary ledger for Work in Process Inventory? For Finished Goods Inventory?
Sager Company manufactures variations of its product, a technopress, in response to custom orders from its customers. On May 1, the company had no inventories of work in process or finished goods but held the following raw materials.
Material M . . . . . . . . . . . . . . . . . . . . . . 200 units @ \(250 = \)50,000
Material R . . . . . . . . . . . . . . . . . . . . . . 95 units @ 180 = 17,100
Paint . . . . . . . . . . . . . . . . . . . . . . . . . . . 55 units @ 75 = 4,125
Total cost . . . . . . . . . . . . . . . . . . . . . . . \(71,225
On May 4, the company began working on two technopresses: Job 102 for Worldwide Company and Job 103 for Reuben Company
Required
Using Exhibit 15.3 as a guide, prepare job cost sheets for Jobs 102 and 103. Using Exhibit 15.5 as a guide, prepare materials ledger cards for Material M, Material R, and paint. Enter the beginning raw materials inventory dollar amounts for each of these materials on their respective ledger cards. Then, follow the instructions in this list of activities.
Receiving Report No. 426, Material M, 250 units at \)250 each.
Receiving Report No. 427, Material R, 90 units at \(180 each.
Instructions: Record these purchases with a single journal entry. Enter the receiving report information on the materials ledger cards.
Requisition No. 35, for Job 102, 135 units of Material M.
Requisition No. 36, for Job 102, 72 units of Material R.
Requisition No. 37, for Job 103, 70 units of Material M.
Requisition No. 38, for Job 103, 38 units of Material R.
Requisition No. 39, for 15 units of paint.
Instructions: Enter amounts for direct materials requisitions on the materials ledger cards and the job cost sheets. Enter the indirect materials amount on the materials ledger card. Do not record a journal entry at this time.
Time tickets Nos. 1 to 10 for direct labor on Job 102, \)90,000.
Time tickets Nos. 11 to 30 for direct labor on Job 103, \(65,000.
Time tickets Nos. 31 to 36 for equipment repairs, \)19,250.
Instructions: Record direct labor from the time tickets on the job cost sheets. Do not record a journal entry at this time.
Instructions: Record these payments with journal entries.
Instructions: Enter the applied overhead on the cost sheet for Job 102, fill in the cost summary section of the cost sheet, and then mark the cost sheet “Finished.” Prepare a journal entry to record the job’s completion and its transfer to Finished Goods.
Instructions: Prepare journal entries to record the sale of Job 102 and the cost of goods sold.
Instructions: Enter overhead on the job cost sheet but do not make a journal entry at this time.
Instructions: Prepare a journal entry to record these costs.
Instructions: Prepare a journal entry to record the allocation of these overhead costs.
j. Compute the balance in the Factory Overhead account as of the end of May.
Moonrise Bakery applies factory overhead based on direct labor costs. The company incurred the following costs during 2017: direct materials costs, \(650,000; direct labor costs, \)3,000,000; and factory overhead costs applied, \(1,800,000.
1. Determine the company’s predetermined overhead rate for 2017.
2. Assuming that the company’s \)71,000 ending Work in Process Inventory account for 2017 had \(20,000 of direct labor costs, determine the inventory’s direct materials costs.
3. Assuming that the company’s \)490,000 ending Finished Goods Inventory account for 2017 had $250,000 of direct materials costs, determine the inventory’s direct labor costs and its overhead costs.
: Using Exhibit 15.15 as a guide, prepare summary journal entries to record the following transactions and events a through g for a company in its first month of operations.
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