Just-in-Time Journal Entries Audio Master, Inc., manufactures audio speakers. Ea

Question

Just-in-Time Journal Entries Audio Master, Inc., manufactures audio speakers. Each speaker requires $111 per unit of direct materials. The speaker manufacturing assembly cell includes the following estimated costs for the period: Speaker assembly cell, estimated costs: Labor Depreciation Supplies Power Total cell costs for the period The operating plan calls for 140 operating hours for the period. Each speaker requires 12 minutes of cell process time. The unit selling price for each speaker is $301. During the period, the following transactions occurred $49,940 6,700 2,440 1,820 $60,900 1. Purchased materials to produce 535 speaker units 2. Applied conversion costs to production of 510 speaker units 3. Completed and transferred 485 speaker units to finished goods 4. Sold 465 speaker units There were no inventories at the beginning of the period

Explanation / Answer

The oprating plan is for 140 operating hrs Each speaker takes 12 mins of cell time. No of Speakers considered for operating plan= 140*60/12=700 speakers Estimated cost for 700 speakers Total Per unit Labor               49,940 $                             71.34 Overheads Depreciation               6,700 Supplies                 2,440 Power               1,820 Total overhead             10,960 $                             15.66 Total Conversion cost               60,900 $                             87.00 Direct Material cost per unit                                     111 a Journal Entries      1 Account Title Dr $ Cr $ Materials Inventory             59,385 Accounts Payable                               59,385      2 Work In Process           100,980 Materials Inventory                               56,610 Wages Payable                               36,385 Overhead Control Account                                 7,985 ( Matrerial, labor & OH assigned for 510 units)      3 Work In Process                               96,030 Finished Goods Inventory             96,030 ( completed & transferred 485 units to FG)      4 Sales Revenue                            139,965 Accounts Receivable           139,965 Finished Goods Inventory                               92,070 Cost of Goods Sold             92,070 b Raw Material ending Inventory =               2,775 WIP Ending inventory=               4,950 Finished godds ending inventory               3,960 T Account -Raw Materials   Details Amt $ Details Amt $ To A/c Payable               59,385 By issue to WIP              56,610 Cl Balance =               2,775 T Account -WIP Details Amt $ Details Amt $ To Material             56,610 By issue to FG              96,030 To Labor             36,385 To Overhead               7,985 Closing Balance               4,950 T Account -FG   Details Amt $ Details Amt $ To WIP               96,030 By COGS                92,070 Closing Balance               3,960

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