PROBLEM IV Derby Music Company specializes in producing and packaging compact di

Question

PROBLEM IV
Derby Music Company specializes in producing and packaging compact discs (CDs) for the music recording industry. Derby use a job order cost system. The following data summarize the operations related to production for March, the first month of operations: a. Materials purchased on account. $15,500. b. Materials requisitioned and labor used. ?Materials?Factory Labor Job No. 100?$2,650?? $1,770 Job No. 101? 1,240?? 650 Job No. 102? 980?? 420 Job No. 103? 3,420?? 1,900 Job No. 104? 1,000?? 500 Job No. 105? 2,100?`?? 1,760 For general factory use? 450?? 650 c. Factory overhead costs incurred on account. $2,700 d. Depreciation of machinery. $1,750 e. Factory overhead is applied at a rate of 70% of direct labor cost. f. Jobs completed: Nos. 100, 101, 102, 104 g. Jobs 100, 101, 102 were shipped and customers were billed for $8,100, $3,800 and $3,500 respectively. INSTRUCTIONS 1. Journalize the entries to record the transactions indentified above. 2. Determine the account balances for Work in Process and Finished Goods. 3. Prepare a schedule of unfinished jobs to support the balances in the work in process account 4. Prepare a schedule of completed jobs on hand to support the balance in the finished goods account. PROBLEM IV
Derby Music Company specializes in producing and packaging compact discs (CDs) for the music recording industry. Derby use a job order cost system. The following data summarize the operations related to production for March, the first month of operations: a. Materials purchased on account. $15,500. b. Materials requisitioned and labor used. ?Materials?Factory Labor Job No. 100?$2,650?? $1,770 Job No. 101? 1,240?? 650 Job No. 102? 980?? 420 Job No. 103? 3,420?? 1,900 Job No. 104? 1,000?? 500 Job No. 105? 2,100?`?? 1,760 For general factory use? 450?? 650 c. Factory overhead costs incurred on account. $2,700 d. Depreciation of machinery. $1,750 e. Factory overhead is applied at a rate of 70% of direct labor cost. f. Jobs completed: Nos. 100, 101, 102, 104 g. Jobs 100, 101, 102 were shipped and customers were billed for $8,100, $3,800 and $3,500 respectively. INSTRUCTIONS 1. Journalize the entries to record the transactions indentified above. 2. Determine the account balances for Work in Process and Finished Goods. 3. Prepare a schedule of unfinished jobs to support the balances in the work in process account 4. Prepare a schedule of completed jobs on hand to support the balance in the finished goods account. PROBLEM IV
Derby Music Company specializes in producing and packaging compact discs (CDs) for the music recording industry. Derby use a job order cost system. The following data summarize the operations related to production for March, the first month of operations: a. Materials purchased on account. $15,500. b. Materials requisitioned and labor used. ?Materials?Factory Labor Job No. 100?$2,650?? $1,770 Job No. 101? 1,240?? 650 Job No. 102? 980?? 420 Job No. 103? 3,420?? 1,900 Job No. 104? 1,000?? 500 Job No. 105? 2,100?`?? 1,760 For general factory use? 450?? 650 c. Factory overhead costs incurred on account. $2,700 d. Depreciation of machinery. $1,750 e. Factory overhead is applied at a rate of 70% of direct labor cost. f. Jobs completed: Nos. 100, 101, 102, 104 g. Jobs 100, 101, 102 were shipped and customers were billed for $8,100, $3,800 and $3,500 respectively. INSTRUCTIONS 1. Journalize the entries to record the transactions indentified above. 2. Determine the account balances for Work in Process and Finished Goods. 3. Prepare a schedule of unfinished jobs to support the balances in the work in process account 4. Prepare a schedule of completed jobs on hand to support the balance in the finished goods account.

Explanation / Answer

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Schedule of Unifinished Job, Jobs Completed on hand, jobs completed and sold Particualrs Unifinished Jobs Job completed on hand Job completed and sold Job No 103 Job No 105 Total Job No 104 Job No 100 Job No 101 Job No 102 Total Direct material $3,420.00 $2,100.00 $5,520.00 $1,000.00 $2,650.00 $1,240.00 $980.00 $4,870.00 Direct labor $1,900.00 $1,760.00 $3,660.00 $500.00 $1,770.00 $650.00 $420.00 $2,840.00 Factory overhead applied (70% of DL Cost) $1,330.00 $1,232.00 $2,562.00 $350.00 $1,239.00 $455.00 $294.00 $1,988.00 Total $6,650.00 $5,092.00 $11,742.00 $1,850.00 $5,659.00 $2,345.00 $1,694.00 $9,698.00

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