See below answers. This was what I was given the first time I submitted this que

Question

See below answers. This was what I was given the first time I submitted this question, with the exception of the letters on each side.

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Widmer Watercraft’s predetermined overhead rate for the year 2017 is 200% of direct labor. Information on the company’s production activities during May 2017 follows.

Purchased raw materials on credit, $220,000.

Materials requisitions record use of the following materials for the month.

132,500

Paid $15,750 cash to a computer consultant to reprogram factory equipment.

Time tickets record use of the following labor for the month. These wages were paid in cash.

Applied overhead to Jobs 136, 138, and 139.

Transferred Jobs 136, 138, and 139 to Finished Goods.

Sold Jobs 136 and 138 on credit at a total price of $545,000.

The company incurred the following overhead costs during the month (credit Prepaid Insurance for expired factory insurance).

Applied overhead at month-end to the Work in Process Inventory account (Jobs 137 and 140) using the predetermined overhead rate of 200% of direct labor cost.

Post the journal entries for the transactions to the following T-accounts, each of which started the month with a zero balance.

Job 136 $ 49,000 Job 137 33,500 Job 138 20,200 Job 139 22,800 Job 140 7,000 Total direct materials

132,500

Indirect materials 21,000 Total materials used $ 153,500

Explanation / Answer

In the books of Windmer Watercrafts:

Cost Sheet: May 2017

Raw Materials Inventory:

Work in Process Inventory:

Finished Goods Inventory:

Cost of Goods Sold:

Factory Overhead:

Transaction / Event Account Titles Debits Credits $ $ 1. Raw Materials Inventory 220,000 Accounts Payable 220,000 2. Work in Process Inventory 132,500 Factory Overhead 21,000 Raw Materials Inventory 153,500 3. Factory Overhead 15,750 Cash 15,750 4. Work in Process Inventory 103,500 Factory Overhead 25,500 Cash 129,000 5. Work in Process Inventory 179,200 Factory Overhead 179,200 6. Finished Goods Inventory 360,800 Work in Process Inventory 360,800 7. Accounts Receivable 545,000 Sales 545,000 7. Cost of Goods Sold 219,200 Finished Goods Inventory 219,200 8. Factory Overhead 154,500 Accumulated Depreciation : Building 70,000 Accumulated Depreciation : Equipment 38,000 Prepaid Insurance 11,000 Property Taxes Payable 35,500 9. Work in Process Inventory 27,800 Factory Overhead 27,800

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