In: Accounting
Johnson's manufactures widgets. One of their clients requested some special custom widgets, which was labeled as Job ID #116 and requires 8,000 direct labor hours.
The following transactions were recorded for the year:
- Purchased $150,000 of raw materials using cash.
- Raw materials including direct materials $220,000 and indirect
materials $68,000 were put into production.
- The company incurred $250,000 for direct labor and $125,000 for
indirect labor.
- During the period, the company has also incurred the following
factory costs: $70,000 for utilities and $25,000 for
supplies.
- The company recognized $25,000 in depreciation of factory
equipment.
- $805,000 of the job was completed by the end of the period.
- The company allocated overhead cost to the job on the basis of
direct labor hours worked. For the current year, the company
estimated that it would require 12,500 direct labor hours and incur
$250,000 of manufacturing overhead.
- The widgets were sold on account for $1,650,000. The cost to
manufacture these products was $1,350,000.
Do not enter dollar signs or commas in the input boxes.
Round the predetermined overhead to 2 decimal places. Round all
other answers to the nearest whole number.
Job #112 costing card:
Mat: $Answer
Lab: $Answer
MOH: $Answer
Total: $Answer
b) Complete the following manufacturing journal entries representing job order costing.
Date | Account Title and Explanation | Debit | Credit |
1 | Raw Materials | Answer | |
Cash | Answer | ||
To record purchase of raw materials with cash | |||
2 | WIP | Answer | |
Manufacturing Overhead | Answer | ||
Raw Materials | Answer | ||
Enter direct and indirect materials into production | |||
3 | WIP | Answer | |
Manufacturing Overhead | Answer | ||
Wages Payable | Answer | ||
To apply direct and indirect labor | |||
4 | Manufacturing Overhead | Answer | |
Accounts Payable | Answer | ||
To record factory costs for utilities and supplies | |||
5 | Manufacturing Overhead | Answer | |
Accumulated Depreciation | Answer | ||
To record depreciation on factory equipment | |||
6 | WIP | Answer | |
Manufacturing Overhead | Answer | ||
To record allocated manufacturing overhead | |||
7 | Finished Goods Inventory | Answer | |
WIP | Answer | ||
To transfer WIP to finished goods inventory | |||
8 | Accounts Receivbale | Answer | |
Sales Revenue | Answer | ||
To record sales revenue | |||
9 | Cost of Goods Sold | Answer | |
Finished Goods Inventory | Answer | ||
To record cost of goods sold |