Chapter 17: 17-1SE-e (page 938)
Distinguishing between job order costing and process costing
Would the following companies most likely use job order costing or process costing?
e. A landscape contractor
Landscape contractors were most likely to use a job-order costing system.
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Question: The T-account showing the manufacturing overhead activity for Aliyah Corp. for 2018is as follows:
Manufacturing overhead
| 195,000 | 203,000 |
Requirements
2. What is the allocated manufacturing overhead?
June production generated the following activity in Bentley Chassis Company’s Work-in-Process Inventory account:
June 1 balance | \(36,000 |
Direct materials used | 32,000 |
Direct labor assigned to jobs | 40,000 |
Manufacturing overhead allocated to jobs | 28,000 |
Additionally, Bentley Chassis has completed Jobs 142 and 143, with total costs of
\)37,000 and $48,000, respectively.
Requirements
2. Open a T-account for Work-in-Process Inventory. Post the journal entry made in Requirement 1. Compute the ending balance in the Work-in-Process Inventory
account on June 30.
Question: Give the journal entry for the completion of a job. How is the accounting equation affected?
What is the predetermined overhead allocation rate?
Question: Analyze the following T-accounts, and describe each lettered transaction. Note that some transactions may be compound entries.
Raw material inventory
(a) | (b) |
Work in process inventory
(b) | (f) |
(c ) | |
(e ) |
Finished goods inventory
(f) | (g) |
Prepaid insurance
(d) |
Account payable
(a) |
Wages payable
(c) |
Manufacturing overhead
(b) | (e) |
(c ) | (h) |
(d) |
Cost of goods sold
(g) | |
(h) |
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