PA2-5 Recording Manufacturing Costs and Analyzing Manufacturing Overhead [LO 2-3
ID: 2610197 • Letter: P
Question
PA2-5 Recording Manufacturing Costs and Analyzing Manufacturing Overhead [LO 2-3, 2-4, 2-5] Christopher's Custom Cabinet Company uses a job order cost system with overhead applied as a percentage of direct labor costs, Inventory balances at the beginning of 2018 falikra Raw Materials Inventory Work in Process Inwentory Finished Goods Inventory $16,800 5.800 21,400 The following transaction (a) Purchased materials on account for $26,600 s occurred during January ssued materials to production totaling $21,800. 90 percen ofwich was traced to specific jolbs and the remainder of which was reated as indirect material (e) Payroll costs totaling $18,200 were recorded as follows $11,000 for assembly workers 1,600 for factory supervision 2,300 for administrative personnel 3,300 for sales commissions (d) Recorded depreciation: $4,300 for machines, $B0O for the copier u e) Recorded $1.1 (f) Paid S6,000 in other factory costs in cash. (g) Applied manufacturing overheed at a rate of 200 percent of direct labor cost nsurance. Forty percent was ingurr used in the administrative office one; the job cost sheet for this job shows $2.300 for direct materials, $2.500 Sor direct labor, and $5,000 for applied overhead. Forty percent was insuranoe on the manufacturing facility, with the r emainder classified as an administrative expense. Sold jobs costing $50,800. The revenue earned on these jobs was S66040 Required: posting to the 1. Set up T-accounts, record the beginning balances, post the January transactions, and compute the final balance for the following accounts: (Post all amount s separacaly. Do not combineladd any d dollar amounts when a. Raw Materials Inventory b. Work in Process Inventory c. Finished Goods Inventory d, Cost of Goods Sold. e. Selling, General, and Administrative Expenses. f. Sales Revenue g. Other accounts (CashPayables, etc.). in Beg. Bal Beg. Bal Monday /292018 Type here to searchExplanation / Answer
1. T-accounts
2.
Working:
Sales revenue = $66,040
Unadjusted cost of goods sold = $50,800
Unadjusted gross profit = $15,240
3.
Overhead applied $22,000
Overhead incurred $14,520
Overhead overapplied $7,480
4.
Unadjusted gros profit = $15,240
Adjustment for overapplied overhead = $ 7,480
Adjusted Gross Profit =$22,720
Christopher's Cushion Cabinet Company Raw Material Work-in-process Event Debit Credit Event Event Debit Credit Event Beg.Bal. 16800 19620 b Beg.Bal. 5800 48620 h a 26600 2180 b b 19620 9800 End.Bal. 21600 End.Bal. c 11000 g 22000 43400 43400 58420 58420 Beg.Bal. 21600 Beg.Bal. 9800 Finished goods Manufacturing overhead Event Debit Credit Event Event Debit Credit Event Beg.Bal. 21400 50800 i b 2180 22000 g h 48620 19220 End.Bal. c 1600 d 4300 e 440 70020 70020 f 6000 Beg.Bal. 19220 14520 22000 Cost of goods sold Selling,General and Admin.Overhead Event Debit Credit Event Event Debit Credit Event i 50800 c 6600 8060 m d 800 e 660 50800 0 8060 8060 Sales Revenue Other Acounts (Cash, Payables Etc.) Event Debit Credit Event Event Debit Credit Event 66040 i 26600 a 19200 c 5100 d 0 66040 1100 e 6000 f 58000 58000 Beg.Bal.Related Questions
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