Question

Sweeten Company had no jobs in progress at the beginning of March and no beginning inventories. It started only two jobs during March—Job P and Job Q. Job P was completed and sold by the end of the March and Job Q was incomplete at the end of the March. The company uses a plantwide predetermined overhead rate based on direct labor-hours. The following additional information is available for the company as a whole and for Jobs P and Q (all data and questions relate to the month of March):

Estimated total fixed manufacturing overhead	$	11,500
Estimated variable manufacturing overhead per direct labor-hour	$	1.30
Estimated total direct labor-hours to be worked		2,300
Total actual manufacturing overhead costs incurred	$	14,000

	Job P		Job Q
Direct materials	$	14,500	$	8,300
Direct labor cost	$	19,600	$	9,100
Actual direct labor-hours worked		1,400		650

5.Assume the ending raw materials inventory is $1,300 and the company does not use any indirect materials. Prepare the journal entries to record raw materials purchases and the issuance of direct materials for use in production. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

6.Assume that the company does not use any indirect labor. Prepare the journal entry to record the direct labor costs added to production. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

7. Prepare the journal entry to apply manufacturing overhead costs to production. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

8. Assume the ending raw materials inventory is $1,300 and the company does not use any indirect materials. Prepare a schedule of cost of goods manufactured.

Answer 1

Date	Accounts Title And Explanation	Debit ($)	Credit($)
5)	Raw Materiala Inventory	24100
	Cash		24100
	(purchase of rawmateriaal)
	Work in process Inventory	22800
	Raw Material		22800
	(Direct Material used)
6)	Work In Process Inventory	28700
	Factory Payroll		28700
	(Direct Labor Used)
7)	Work In Process	12915
	fixed Overhead		10250
	Variable Overhead		2665
	(Overhead Applied)

Finished Goods Inventory	42820
Work In process Inventory		42820
(JOB P being completed)

W/N:

RM used	22800
(+)end. RM	1300
	24100

fixed Overhead		10250	(2050*5)
Variable Overhead		2665	(2050*1.3)

Total Actual Hours Worked =1400+650 =2050 hours

Predetermined Variable OH rate /Houre =$1.3

Predetrmined Fixed Overhate rate =11500/2300 =$5

8). Since Job P is Completed , It will Be transferred to finished goods Inventory .Therefore cost of Goods Manufactured for the whole company is

Schedule Of Cost Of Goods Manufactured

Beginning Work In Process	0
Total Manufacturing Cost	64315
(-) Ending Work In Process	-21495
Cost Of Goods Manufactured	42820

$21495 is Total Cost of JOB Q which is still incomplete

Cost Of Goods Manufactured
	job	P	Q
beginning WIP		0	0
DM used		14400	8300
Direct labor		19600	9100
Overhead Applied
Fixed OH		7000	3250
Variable OH		1820	845
Total Job Cost		42820	21495

Note : Since JobP is completed It will Be moved to finished goods. Job P is still incomplete,Hence It will be still Recorded in Work In Process Inventory.