Haslett Corporation uses standard costs with its job order cost accounting syste

Question

Haslett Corporation uses standard costs with its job order cost accounting system. In January, an order (Job No. 12) for 2,000 units of Product B was received. The standard cost of one unit of Product B is as follows.

Direct materials 2 pounds at $1.50 per pound $ 3.00 Direct labor 1.50 hour at $9 per hour 13.50 Overhead 2 hours (variable $4.50 per machine hour; fixed $3.00 per machine hour) 15.00 Standard cost per unit $31.50
Normal capacity for the month was 4,060 machine hours. During January, the following transactions applicable to Job No. 12 occurred.

1. Purchased 4,700 pounds of raw materials on account at $1.57 per pound. 2. Requisitioned 4,700 pounds of raw materials for Job No. 12. 3. Incurred 3,080 hours of direct labor at a rate of $8.89 per hour. 4. Worked 3,080 hours of direct labor on Job No. 12. 5. Incurred manufacturing overhead on account $34,750. 6. Applied overhead to Job No. 12 on basis of standard machine hours allowed. 7. Completed Job No. 12. 8. Billed customer for Job No. 12 at a selling price of $190,000. Haslett Corporation uses standard costs with its job order cost accounting system. In January, an order (Job No. 12) for 2,000 units of Product B was received. The standard cost of one unit of Product B is as follows.

Direct materials 2 pounds at $1.50 per pound $ 3.00 Direct labor 1.50 hour at $9 per hour 13.50 Overhead 2 hours (variable $4.50 per machine hour; fixed $3.00 per machine hour) 15.00 Standard cost per unit $31.50
Normal capacity for the month was 4,060 machine hours. During January, the following transactions applicable to Job No. 12 occurred.

1. Purchased 4,700 pounds of raw materials on account at $1.57 per pound. 2. Requisitioned 4,700 pounds of raw materials for Job No. 12. 3. Incurred 3,080 hours of direct labor at a rate of $8.89 per hour. 4. Worked 3,080 hours of direct labor on Job No. 12. 5. Incurred manufacturing overhead on account $34,750. 6. Applied overhead to Job No. 12 on basis of standard machine hours allowed. 7. Completed Job No. 12. 8. Billed customer for Job No. 12 at a selling price of $190,000.

Journalize the transactions.
Direct materials 2 pounds at $1.50 per pound $ 3.00 Direct labor 1.50 hour at $9 per hour 13.50 Overhead 2 hours (variable $4.50 per machine hour; fixed $3.00 per machine hour) 15.00 Standard cost per unit $31.50

Explanation / Answer

DR CR Raw Materials Inventory (4700 X $1.50) 7050 Materials Price Variance 329 Accounts Payable 4700*1.57 7379 Work in Process Inventory (4,700* X $1 4700 Materials Quantity Variance(4700-4700)*1 0 Raw Materials Inventory 4700 Factory Labor (3080 X 9) 27720 Labor Price Variance . 339 Wages Payable 3080*8.89 27381 Work in Process Inventory 3080*9 27720 Labor Quantity Variance Factory Labor. 27720 Manufacturing Overhead 34750 Accounts Payable 34750 Work in Process Inventory (2000*2)*(4.50+3.00) 30000 Manufacturing Overhead 30000 Finished Goods Inventory 2000*31.50 63000 Work in Process Inventory 63000 Accounts Receivable 190000 Sales 190000 Cost of Goods Sold 63000 Finished Goods Inventory . 63000

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