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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

3. Prepare the journal entry to record the sale on account of Job 143 for \)63,000.

Also, prepare the journal entry to record Cost of Goods Sold for Job 143.

Short Answer

Expert verified

Date

Particulars

Debit ($)

Credit ($)

1

Accounts receivable

63,000

Sales revenue

63,000

(to record sales on account)

2

Cost of goods sold

48,000

Finished goods inventory

48,000

(to record the cost of good sold for job 143)

Step by step solution

01

Sales revenue

Sales revenue is calculated by multiplying the unit price of the product with the number of units sold by the company during the year.

02

Recording of sales and cost of goods sold in the books of the company

The company record the sales of the company by debiting the account receivable and crediting the sales revenue and the cost of good sold is recorded by debiting the cost of goods sold by the company and crediting the finished goods inventory.

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Most popular questions from this chapter

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 Inventoryaccount on June 30.

Comparing actual to allocated overhead

Columbus Enterprises reports the following information at December 31, 2018:

Manufacturing overhead

3,500

50,600

19,000

34,500

Requirements

1. What is the actual manufacturing overhead of Columbus Enterprises?

The manufacturing records for Sporty Kayaks at the end of the 2018 fiscal year show the following information about manufacturing overhead:

Overhead allocated to production

\(409,200

Actual manufacturing overhead cost

432,000

Predetermined overhead allocation rate

\)44 per machine hours

Requirements

2. Was manufacturing overhead overallocated or underallocated for the year, and by how much?

Explain the terms accumulate, assign, allocate, and adjust as they apply to job order costing.

Rosco Company estimates the company will incur $80,750 in overhead costs and 4,750 direct labor hours during the year. Actual direct labor hours were 4,600. Calculate the predetermined overhead allocation rate using direct labor hours as the allocation base, and prepare the journal entry for the allocation of overhead.

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