Question

Entries for Factory Costs and Jobs Completed

Collegiate Publishing Inc. began printing operations on March 1. Jobs 301 and 302 were completed during the month, and all costs applicable to them were recorded on the related cost sheets. Jobs 303 and 304 are still in process at the end of the month, and all applicable costs except factory overhead have been recorded on the related cost sheets. In addition to the materials and labor charged directly to the jobs, $1,710 of indirect materials and $20,710 of indirect labor were used during the month. The cost sheets for the four jobs entering production during the month are as follows, in summary form:

Job 301  Job 302

Direct materials$24,790 Direct materials$11,590

Direct labor9,500 Direct labor4,900

Factory overhead5,225 Factory overhead2,695

Total$39,515 Total$19,185

      

Job 303  Job 304

Direct materials$35,000 Direct materials$7,140

Direct labor10,500 Direct labor1,400

Factory overhead—  Factory overhead—

Journalize the summary entry to record each of the following operations for March (one entry for each operation):

a. Direct and indirect materials used. If an amount box does not require an entry, leave it blank.

Work in Process

Factory Overhead

Materials

Feedback

a. Record direct materials costs in the Work in Process account, and indirect materials costs in the Factory Overhead account.

b. Direct and indirect labor used. If an amount box does not require an entry, leave it blank.

Work in Process

Factory Overhead

Wages Payable

b. Record direct labor costs in the Work in Process account, and indirect labor costs in the Factory Overhead account.

c. Factory overhead applied to all four jobs (a single overhead rate is used based on direct labor cost). If an amount box does not require an entry, leave it blank.

Work in Process

Factory Overhead

c. Apply factory overhead based on direct labor costs.

d. Completion of Jobs 301 and 302. If an amount box does not require an entry, leave it blank.

Finished Goods

Work in Process

Answer 1

a.

Account Titles	Debit	Credit
Work in Process	$         78,520
Factory Overhead	$           1,710
Materials		$         80,230

b.

Account Titles	Debit	Credit
Work in Process	$         26,300
Factory Overhead	$         20,710
Wages Payable		$         47,010

c.
Overhead rate = $5225 / 9500 = 55%

Account Titles	Debit	Credit
Work in Process	$         14,465
Factory Overhead		$         14,465

d.

Account Titles	Debit	Credit
Finished Goods	$         58,700
Work in Process		$         58,700