Question 7 : Froya Fabrikker A/S of Bergen, Norway, is a small company that manu
ID: 2586967 • Letter: Q
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Question 7 : Froya Fabrikker A/S of Bergen, Norway, is a small company that manufactures specialty heavy equipment for use in North Sea oil fields. The company uses a job-order costing system and applies manufacturing overhead cost to jobs on the basis of direct labor-hours. Its predetermined overhead rate was based on a cost formula that estimated $380,000 of manufacturing overhead for an estimated allocation base of 1,000 direct labor-hours. The following transactions took place during the year (all purchases and services were acquired on account):
Depreciation was recorded for the year, $87,000 (80% related to factory equipment, and the remainder related to selling and administrative equipment).
Rental cost incurred on buildings, $112,000 (85% related to factory operations, and the remainder related to selling and administrative facilities).
Cost of goods manufactured for the year, $920,000.
Sales for the year (all on account) totaled $1,950,000. These goods cost $950,000 according to their job cost sheets.
The balances in the inventory accounts at the beginning of the year were:
Prepare journal entries to record the above data. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Post your entries to T-accounts. (Don’t forget to enter the opening inventory balances below.) Determine the ending balances in the inventory accounts and in the Manufacturing Overhead account. (Accounts recievable, sales, raw materials, cost of goods sold, work in process, manufacturing overhead, finished goods, advertising expense, accumulated depreciation, utilities expense, accounts payable, salaries expense, depreciation expense, salaries & wages payable, rent expense)
Prepare a journal entry to close any balance in the Manufacturing Overhead account to Cost of Goods Sold. Prepare a schedule of cost of goods sold. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Prepare an income statement for the year.
Job 412 was one of the many jobs started and completed during the year. The job required $9,500 in direct materials and 35 hours of direct labor time at a total direct labor cost of $10,400. If the job contained four units and the company billed at 70% above the unit product cost on the job cost sheet, what price per unit would have been charged to the customer?
Question 7 : Froya Fabrikker A/S of Bergen, Norway, is a small company that manufactures specialty heavy equipment for use in North Sea oil fields. The company uses a job-order costing system and applies manufacturing overhead cost to jobs on the basis of direct labor-hours. Its predetermined overhead rate was based on a cost formula that estimated $380,000 of manufacturing overhead for an estimated allocation base of 1,000 direct labor-hours. The following transactions took place during the year (all purchases and services were acquired on account):
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Froya Fabriker, A/S General journal for the year Ref Account title Debit Credit a Raw material 275000 Accounts payable 275000 b Work in process 260000 Raw material 260000 c Utilities expense 74000 Accounts payable 74000 Factory overhead 70300 Utilities expese 70300 d Salaries expense 595000 Salaries payable 595000 Work in process 305000 Factory overhead 105000 Salaries expense 410000 e Factory overhead 69000 Accounts payable 69000 f Advertising expense 151000 Accounts payable 151000 g Depreciation expense 87000 Accumulated depreciation 87000 Factory overhead 69600 Depreciation expense 69600 h Rent expense 112000 Accounts payable 112000 Factory overhead 95200 Rent expense 95200 i Work in process 418000 Factory overhead 418000 j Finished goods 920000 Work in process 920000 k Accounts receivable 1950000 Sales revenue 1950000 Cost of goods sold 950000 Finished goods 950000Related Questions
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