Question

Required information Problem 19-3A Source documents, journal entries, and accounts in job order costing LO P1, P2, P3 [The following information applies to the questions displayed below.] Widmer Watercraft’s predetermined overhead rate for the year 2017 is 200% of direct labor. Information on the company’s production activities during May 2017 follows. Purchased raw materials on credit, $220,000. Materials requisitions record use of the following materials for the month. Job 136 $ 48,500 Job 137 32,500 Job 138 19,800 Job 139 22,800 Job 140 7,000 Total direct materials 130,600 Indirect materials 20,500 Total materials used $ 151,100 Paid $15,000 cash to a computer consultant to reprogram factory equipment. Time tickets record use of the following labor for the month. These wages were paid in cash. Job 136 $ 12,100 Job 137 10,600 Job 138 37,700 Job 139 39,600 Job 140 3,600 Total direct labor 103,600 Indirect labor 24,500 Total $ 128,100 Applied overhead to Jobs 136, 138, and 139. Transferred Jobs 136, 138, and 139 to Finished Goods. Sold Jobs 136 and 138 on credit at a total price of $535,000. The company incurred the following overhead costs during the month (credit Prepaid Insurance for expired factory insurance). Depreciation of factory building $ 69,500 Depreciation of factory equipment 38,500 Expired factory insurance 11,000 Accrued property taxes payable 35,000 Applied overhead at month-end to the Work in Process Inventory account (Jobs 137 and 140) using the predetermined overhead rate of 200% of direct labor cost.

Answer 1

Ans- Job Cost Sheet

	Job No.136	Job No. 137	Job No.138	Job No.139	Job No.140
Materials	$48,500	$32,500	$19,800	$22,800	$7,000
Labor	12,100	10,600	37,700	39,600	3,600
Overhead	24,200	21,200	75,400	79,200	7,200
Total Cost	$84,800	$64,300	$132,900	$141,600	$17,800

Journal Entries

Transaction	General Journal	Debit ($)	Credit ($)
A.	Raw material inventory	220,000
	Accounts payable		220,000
B	Goods in process inventory	130,600
	Factory overhead	20,500
	Raw materials inventory		151,100
C.	Factory overhead	15,000
	Cash		15,000
D.	Goods in process inventory	103,600
	Factory overhead	24,500
	Factory payroll		128,100
E.	Goods in process inventory	178,800
	Factory overhead		178,800
F.	Finished goods inventory	359,300
	Goods in process inventory		359,300
G.(1)	Accounts Receivable	535,000
	Sales		535,000
G. (2)	Cost of goods sold ($84,800+$132,900)	217,700
	Finished goods inventory		217,700
H.	Factory Overhead	154,000
	Accumulated depreciation - Factory building		69,500
	Accumulated depreciation- Factory equipment		38,500
	Prepaid insurance		11,000
	Property taxes payable		35,000
I.	Goods in process inventory (21,200+7,200)	28,400
	Factory Overhead		28,400

Working Note:-

Goods in process inventory:-

$24,200+$75,400+79,200=$178,800

Finished goods inventory :-

$84,800+$132,900+$141,600

=$359,300

Raw Materials Inventory Account

(A)	220,000
		151,100	(B)
End Bal.	68,900

WIP Inventory

(B)	130,600
(D)	103,600
(E)	178,800
		359,300	(F)
(I)	28,400
End Bal.	82,100

Factory Overhead

(B)	20,500
(C)	15,000
(D)	24,500
		178,800	(E)
(H)	154,000	28,400	(I)
End Bal.	6,800

Finished goods inventory

(F)	359,300
		217,700	(G 2)
End Bal.	141,600

Cost of Goods Sold

(G 2)	217,700
End Bal.	217,700