ACC 330 Lecture Notes - Lecture 10: Finished Good
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The Polaris Company uses a job-order costing system. The following data relate to October, the first month of the companyâs fiscal year. |
a. | Raw materials purchased on account, $210,000. |
b. | Raw materials issued to production, $190,000 ($178,000 direct materials and $12,000 indirect materials). |
c. | Direct labor cost incurred, $90,000; indirect labor cost incurred, $110,000. |
d. | Depreciation recorded on factory equipment, $40,000. |
e. | Other manufacturing overhead costs incurred during October, $70,000 (credit Accounts Payable). |
f. | The company applies manufacturing overhead cost to production on the basis of $8 per machine-hour. A total of 30,000 machine-hours were recorded for October. |
g. | Production orders costing $520,000 according to their job cost sheets were completed during October and transferred to Finished Goods. |
h. | Production orders that had cost $480,000 to complete according to their job cost sheets were shipped to customers during the month. These goods were sold on account at 25% above cost. |
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1. | Prepare journal entries to record the information given above. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Raw materials purchased on account 210,000 Transaction General Journey Debit Credit A Raw materials issued to production, $119,000 ($178,000 direct materials and $12,000 indirect materials) Transaction General Journey Debit Credit B Direct Labor Cost incurred, $90,000; indirect labor cost incurred, $110,000 Transaction General Journey Debit Credit C Depreciation recorded on factory equipment, $40,000 Transaction General Journey Debit Credit D Other man ufacturing overhead cost incrred during October $70,000 (credit Accounts Payable) Transaction General Journey Debit Credit E The company applies manufactring overhead cost to production on the basis of $8 per machine-hour. A total of 30,000 machine-hours were recorded for October Transaction General Journey Debit Credit F. Production orders costing $520,000 according to their job cost sheets were completed during october and transferred to Finished goods Transaction General Journey Debit Credit G. Record the cost of goods sold Transaction General Journey Debit Credit H(1) REcord the sales account Transaction General Journey Debit Credit h(2)
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The Polaris Company uses a job-order costing system. Thefollowing transactions occurred in October:
Raw materials purchased on account, $210,000.
Raw materials used in production, $190,000 ($152,000 directmaterials and $38,000 indirect materials).
Accrued direct labor cost of $48,000 and indirect labor cost of$21,000.
Depreciation recorded on factory equipment, $105,000.
Other manufacturing overhead costs accrued during October,$130,000.
The company applies manufacturing overhead cost to productionusing a predetermined rate of $5 per machine-hour. A total of76,100 machine-hours were used in October.
Jobs costing $511,000 according to their job cost sheets werecompleted during October and transferred to Finished Goods.
Jobs that had cost $449,000 to complete according to their jobcost sheets were shipped to customers during the month. These jobswere sold on account at 30% above cost.
Required:
1. Prepare journal entries to record the transactions givenabove.
2. Prepare T-accounts for Manufacturing Overhead and Work inProcess. Post the relevant transactions from above to each account.Compute the ending balance in each account, assuming that Work inProcess has a beginning balance of $34,000.
Raw materials purchased on account, $210,000.
Note: Enter debits before credits.
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Record the raw materials issued to production, $190,000($152,000 direct materials and $38,000 indirect materials).
Note: Enter debits before credits.
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Record the entry for accrued direct labor cost incurred,$48,000; indirect labor cost incurred, $21,000.
Note: Enter debits before credits.
Depreciation recorded on factory equipment, $105,000. Note: Enter debits before credits.
Other manufacturing overhead costs accrued during October,$130,000. Note: Enter debits before credits.
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Record the cost of goods sold.
Note: Enter debits before credits.
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Record the sales on account.
Note: Enter debits before credits.
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Prepare T-accounts for Manufacturing Overhead and Work inProcess. Post the relevant transactions from above to each account.Compute the ending balance in each account, assuming that Work inProcess has a beginning balance of $34,000.
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