Exercise 16-3 Your answer is partially correct. Try again. A job order cost shee

Question

Exercise 16-3 Your answer is partially correct. Try again. A job order cost sheet for Ryan Company is shown below Job No. 92 Direct Materials Labor For 2,000 Units Manufacturing Overhead Date Beg. bal 5,0006,000 4,200 Jan. 1 6,000 12 25 27 8,000 6,400 2,000 4,000 13,000 18,000 3,200 13,800 Cost of completed job: $13,000 18,000 13,800 $44,800 $22.40 Direct materials Direct labor Manufacturing overhead Total cost Unit cost ($44,800 2,000) (a) On the basis of the foregoing data, answer the following questions. (1) What was the balance in Work in Process Inventory on January 1 if this was the only unfinished job? Balance in Work in Process Inventory on January 1 15200 (2) If manufacturing overhead is applied on the basis of direct labor cost, what overhead rate was used in each year? (Round answers to 0 decimal places, eg, 55%.) Last year Current year Overhead rate 70 80

Explanation / Answer

Finished Goods inventory should be debited by $ 44,800 and correspondingly. work in progress inventory should be credited by this amount.

The reason being that at the month end, if there is no closing balance then it is presumed that the job is completed and there is no work in progress.

In all, the beginning balance of work in progress ($ 15,200) and costs incurredduring the month ($ 29.600) are to be accounted for towards finished goods inventory. Therefore, the sum of the two (15,200+ 29,600) = $ 44,800 should be shown as finished goods inventory debit and work in progress inventory credit.  

Related Questions

Navigate

• Browse (All)
• Browse E
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.