Question

In: Accounting

Jorgensen Corporation uses standard costs with its job order cost accounting system. In January, an order...

Jorgensen Corporation uses standard costs with its job order cost accounting system. In January, an order (Job No. 12) for 1,000 units of Product B was received. The standard cost of one unit of Product B is as follows.

Direct materials 3 pounds at $1.00 per pound $3.00
Direct labor 1.00 hour at $8.00 per hour 8.00
Overhead 2 hours (variable $4.00 per machine hour; fixed $2.50 per machine hour) 13.00
Standard cost per unit $24.00


Normal capacity for the month was 4,000 machine hours. During January, the following transactions applicable to Job No. 12 occurred.

1. Purchased 3,100 pounds of raw materials on account at $1.04 per pound.
2. Requisitioned 3,100 pounds of raw materials for Job No. 12.
3. Incurred 1,040 hours of direct labor at a rate of $7.95 per hour.
4. Worked 1,040 hours of direct labor on Job No. 12.
5. Incurred manufacturing overhead on account $14,250.
6. Applied overhead to Job No. 12 on basis of standard machine hours allowed.
7. Completed Job No. 12.
8. Billed customer for Job No. 12 at a selling price of $75,000.

(a) Journalize the transactions.
(b) Post to the job order cost accounts.

(c) Prepare the entry to recognize the total overhead variance

Solutions

Expert Solution

Part A

No.

General journal

Debit

Credit

1

Raw materials (3100*1)

3100

Materials price variance (3100*(1.04-1))

124

Accounts payable (3100*1.04)

3224

2

Work in process inventory (3000*1)

3000

Materials quantity variance (3100-3000)*1

100

Raw materials inventory

3100

(1000*3) = 3000

3

Factory labor (1040*8)

8320

Labor price variance (1040*(8-7.95))

52

Wages payable (1040*7.95)

8268

4

Work in process inventory (1000*8)

8000

Labor quantity variance (1040-1000)*8

320

Factory labor

8320

1040*1=1040

5

Manufacturing overhead

14250

Accounts payable

14250

6

Work in process inventory (1000*2)*6.50

13000

Manufacturing overhead

13000

7

Finished goods inventory (1000*24)

24000

Work in process inventory

24000

8.

Accounts receivable

75000

sales

75000

Cost of goods sold

24000

Finished goods inventory

24000

Part B

Raw materials inventory

(1)

3100

(2)

3100

Materials price variance

(1)

124

Work in process inventory

(2)

3000

(7)

24000

(4)

8000

(6)

5000

Factory labor

(3)

8320

(4)

8320

Materials quantity variance

(2)

100

Finished goods inventory

(7)

24000

(8)

24000

Manufacturing overhead

(5)

14250

(6)

13000

Labor price variance

(3)

52

Labor Quantity variance

(4)

320

Cost of goods sold

(8)

24000

Part C

No.

General journal

Debit

Credit

1

Overhead variance (14250-13000)

1250

Manufacturing overhead

1250

ekkarill92 answered 1 year ago
Next > < Previous

Related Solutions

Jorgensen Corporation uses standard costs with its job order cost accounting system. In January, an order...
Jorgensen Corporation uses standard costs with its job order cost accounting system. In January, an order (Job No. 12) for 1,000 units of Product B was received. The standard cost of one unit of Product B is as follows. Direct materials 3 pounds at $1.30 per pound $3.90 Direct labor 1.80 hour at $10.00 per hour 18.00 Overhead 2 hours (variable $4.40 per machine hour; fixed $3.40 per machine hour) 15.60 Standard cost per unit $37.50 Normal capacity for the...
Entries for Costs in a Job Order Cost System Velasco Co. uses a job order cost...
Entries for Costs in a Job Order Cost System Velasco Co. uses a job order cost system. The following data summarize the operations related to production for July: Materials purchased on account, $695,900 Materials requisitioned, $584,560, of which $75,990 was for general factory use Factory labor used, $716,780, of which $136,190 was indirect Other costs incurred on account for factory overhead, $167,020; selling expenses, $257,480; and administrative expenses, $153,100 Prepaid expenses expired for factory overhead, $32,010; for selling expenses, $27,140;...
Entries for Costs in a Job Order Cost System Munson Co. uses a job order cost...
Entries for Costs in a Job Order Cost System Munson Co. uses a job order cost system. The following data summarize the operations related to production for July: Materials purchased on account, $732,780 Materials requisitioned, $615,540, of which $80,020 was for general factory use Factory labor used, $754,760, of which $143,400 was indirect Other costs incurred on account for factory overhead, $175,870; selling expenses, $271,130; and administrative expenses, $161,210 Prepaid expenses expired for factory overhead, $33,710; for selling expenses, $28,580;...
Entries for Costs in a Job Order Cost System Munson Co. uses a job order cost...
Entries for Costs in a Job Order Cost System Munson Co. uses a job order cost system. The following data summarize the operations related to production for July: Materials purchased on account, $496,630 Materials requisitioned, $417,170, of which $54,230 was for general factory use Factory labor used, $511,530, of which $97,190 was indirect Other costs incurred on account for factory overhead, $119,190; selling expenses, $183,750; and administrative expenses, $109,260 Prepaid expenses expired for factory overhead, $22,840; for selling expenses, $19,370;...
West Manufacturing Company uses a standard cost system in its accounting records. The standard costs for...
West Manufacturing Company uses a standard cost system in its accounting records. The standard costs for its one product are as follows:                      Materials                                    8 pounds at $1.00 =   $ 8.00                      Direct labor                              1.2 hours at $14.00 =     16.80                      Variable overhead     1.2 direct-labor hours at $4.00 =       4.80                      Fixed overhead         1.2 direct-labor hours at $6.00 =       7.20                      Total standard cost                                                      $36.80             The standard costs per unit are based on normal capacity of 3,600 direct-labor...
Entries for Costs in a Job Order Cost System Royal Technology Company uses a job order...
Entries for Costs in a Job Order Cost System Royal Technology Company uses a job order cost system. The following data summarize the operations related to production for March: Materials purchased on account, $591,670. Materials requisitioned, $497,000, of which $64,610 was for general factory use. Factory labor used, $609,420, of which $115,790 was indirect. Other costs incurred on account for factory overhead, $142,000; selling expenses, $218,920; and administrative expenses, $130,170. Prepaid expenses expired for factory overhead were $27,220; for selling...
Entries for Costs in a Job Order Cost System Royal Technology Company uses a job order...
Entries for Costs in a Job Order Cost System Royal Technology Company uses a job order cost system. The following data summarize the operations related to production for March: Materials purchased on account, $820,330. Materials requisitioned, $689,080, of which $89,580 was for general factory use. Factory labor used, $844,940, of which $160,540 was indirect. Other costs incurred on account for factory overhead, $196,880; selling expenses, $303,520; and administrative expenses, $180,470. Prepaid expenses expired for factory overhead were $37,740; for selling...
Entries for Costs in a Job Order Cost System Royal Technology Company uses a job order...
Entries for Costs in a Job Order Cost System Royal Technology Company uses a job order cost system. The following data summarize the operations related to production for March: Materials purchased on account, $738,430. Materials requisitioned, $620,280, of which $80,640 was for general factory use. Factory labor used, $760,580, of which $144,510 was indirect. Other costs incurred on account for factory overhead, $177,220; selling expenses, $273,220; and administrative expenses, $162,450. Prepaid expenses expired for factory overhead were $33,970; for selling...
Entries for Costs in a Job Order Cost System Royal Technology Company uses a job order...
Entries for Costs in a Job Order Cost System Royal Technology Company uses a job order cost system. The following data summarize the operations related to production for March: Materials purchased on account, $492,950. Materials requisitioned, $414,080, of which $53,830 was for general factory use. Factory labor used, $507,740, of which $96,470 was indirect. Other costs incurred on account for factory overhead, $118,310; selling expenses, $182,390; and administrative expenses, $108,450. Prepaid expenses expired for factory overhead were $22,680; for selling...
Entries for Costs in a Job Order Cost System Royal Technology Company uses a job order...
Entries for Costs in a Job Order Cost System Royal Technology Company uses a job order cost system. The following data summarize the operations related to production for March: Materials purchased on account, $770,000. Materials requisitioned, $680,000, of which $75,800 was for general factory use. Factory labor used, $756,000, of which $182,000 was indirect. Other costs incurred on account for factory overhead, $245,000; selling expenses, $171,500; and administrative expenses, $110,600. Prepaid expenses expired for factory overhead, $24,500; for selling expenses,...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT