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ADMS (3,000)
Lecture

chapter 3 solution manual of mangerial accounting.pdf


Department
Administrative Studies
Course Code
ADMS 2510
Professor
Alison Beavis

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Chapter 3
Systems Design: Job-Order Costing
Problem 3-21 (60 minutes)
1. and 2.
Cash Accounts Receivable
Bal. 63,000
(m) 785,000 Bal. 102,000 (l) 850,000
(l) 850,000 (k) 925,000
Bal. 128,000 Bal. 177,000
Raw Materials Prepaid Insurance
Bal. 30,000 (b) 200,000 Bal. 9,000 (g) 7,000
(a) 185,000 Bal. 2,000
Bal. 15,000
Videos in Process Finished Goods
Bal. 45,000 (j) 550,000 Bal. 81,000 (k) 600,000
(b) 170,000 (j) 550,000
(f) 82,000 Bal. 31,000
(i) 290,000
Bal. 37,000
Studio and Equipment Accumulated Depreciation
Bal. 730,000 Bal. 210,000
(d) 84,000
Bal. 294,000
Studio Overhead Depreciation Expense
(b) 30,000 * (i) 290,000 (d) 21,000
(c) 72,000
(d) 63,000
(f) 110,000
(g) 5,600 Insurance Expense
(n) 9,400 Bal. 9,400 (g) 1,400
© The McGraw-Hill Companies, Inc., 2010. All rights reserved.
Solutions Manual, Appendix 3A 1

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* $280,000 ÷ 7,000 hours = $40 per hour;
7,250 hours × $40 per hour = $290,000
Advertising Expense Miscellaneous Expense
(e) 130,000 (h) 8,600
© The McGraw-Hill Companies, Inc., 2010. All rights reserved.
2 Managerial Accounting, 13th Edition

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Problem 3-21 (continued)
Administrative Salaries Expense Sales
(f) 95,000 (k) 925,000
Cost of Goods Sold Accounts Payable
(k) 600,000 (n) 9,400 (m) 500,000 Bal. 160,000
(a) 185,000
Bal. 590,600 (c) 72,000
(e) 130,000
(h) 8,600
Bal. 55,600
Salaries & Wages Payable
(m) 285,000 (f) 287,000
Bal. 2,000
Capital Stock Retained Earnings
Bal. 420,000 Bal. 270,000
3. Overhead is overapplied for the year by $9,400. Entry (n) above records
the closing of this overapplied overhead balance to Cost of Goods Sold.
4. Supreme Videos, Inc.
Income Statement
For the Year Ended December 31
Sales of videos........................................... $925,000
Cost of goods sold ($600,000 – $9,400)....... 590,600
Gross margin............................................. 334,400
Selling and administrative expenses:
Depreciation expense............................... $ 21,000
Advertising expense................................. 130,000
Administrative salaries ............................. 95,000
Insurance expense .................................. 1,400
Miscellaneous expense............................. 8,600 256,000
Net operating income................................. $ 78,400
© The McGraw-Hill Companies, Inc., 2010. All rights reserved.
Solutions Manual, Appendix 3A 3
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