Question

In: Accounting

Technology Co. manufactures DVDs for computer software and entertainment companies. TrueTrue uses job order costing. On...

Technology Co. manufactures DVDs for computer software and entertainment companies.

TrueTrue

uses job order costing. On

NovemberNovember

​2,

TrueTrue

began production of

5 comma 7005,700

​DVDs, Job​ 423, for

DioramaDiorama

Pictures for

$ 1.40$1.40

sales price per DVD.

TrueTrue

promised to deliver the DVDs to

DioramaDiorama

Pictures by

NovemberNovember

5.

TrueTrue

incurred the following direct​ costs:

LOADING...

​(Click the icon to view the​ costs.)                                                                        

LOADING...

​(Click the icon to view additional​ information.)Read the requirements

LOADING...

.

Requirement 1. Prepare a job cost record for Job 423. Calculate the predetermined overhead allocation rate​ (round to two decimal​ places); then allocate manufacturing overhead to the job.

Begin by determining the total amount of direct materials and direct labor incurred on the job.​ Next, calculate the predetermined overhead allocation rate and apply manufacturing overhead to the job.​ Lastly, compute the total cost of Job 423 and the cost per DVD.

Job Cost Record

Job No.

423

Customer Name

Diorama

Job Description

5,700 DVDs

Date Promised 11-5

Direct materials

Requisition

Date

Number

Amount

11–2

63

$372

11–2

64

725

11–3

74

126

Totals

Date Started 11-2

Direct labor

Labor Time

Record

Number

Amount

655

$160

656

300

Date Completed 11-3

Manufacturing overhead allocated

Date

Rate

Amount

11–2

120%

of direct

labor cost

Overall Cost Summary

Direct materials

Direct labor

Manufacturing overhead

Allocated

Total Job Cost

Cost per DVD

Requirement 2. Journalize in summary form the requisition of direct materials and the assignment of direct labor and the allocation of manufacturing overhead to Job 423. Wages are not yet paid. ​(Record debits​ first, then credits. Exclude explanations from any journal​ entries.)

Start by journalizing the use of direct materials.

Date

Accounts

Debit

Credit

Nov. 3

Work-in-Process Inventory

Raw Materials inventory

1,220

​Next, journalize the use of direct labor.

Date

Accounts

Debit

Credit

Nov. 3

Work-in-Process Inventory

Wages Payable

Now journalize the allocation of overhead to Job 423.

Date

Accounts

Debit

Credit

Nov. 3

Accounts Receivable

Sales Revenue

Requirement 3. Journalize completion of the job and the sale of the

5 comma 7005,700

DVDs on account. ​(Record debits​ first, then credits. Exclude explanations from any journal​ entries.)

Begin by preparing the entry to show the completion of the job.

Date

Accounts

Debit

Credit

Nov. 3

​Next, journalize the revenue portion of the sale of Job 423.

Date

Accounts

Debit

Credit

Nov. 3

​Finally, journalize the cost of goods portion of the sale.

Date

Accounts

Debit

Credit

Nov. 3

Data Table

Date

Labor Time Record No.

Description

Amount

11/02

655

10 hours @ $16 per hour

$160

11/03

656

20 hours @ $15 per hour

300

Materials

Requisition

Date

No.

Description

Amount

11/02

63

31 lbs. polycarbonate plastic @ $12 per lb.

$372

11/02

64

25 lbs. acrylic plastic @ $29 per lb.

725

11/03

74

3 lbs. refined aluminum @ $42 per lb.

126

Solutions

Expert Solution

1 Job cost record
Job No. 423
Customer name Diorama
Job description 5700 DVDs
Date promised 11-5 Date started 4-30 Date completed 5-3
Direct materials Direct labor Manufacturing overhead allocated
Date Requisition number Amount Labor time record number Amount Date Rate Amount
11-2. 63 372 11/02655 160 5/3. 120% of 575
11-2. 64 725 11/03656 300 direct labor cost (160+300)*125%
11-3. 74 126
Overall cost summary
Direct materials 1223
Direct labor 460
Manufacturing overhead allocated 575
Totals 1223 460 Total job cost 2258
2 Date Accounts Debit Credit
Nov 3. Work-in-Process Inventory 1223
Raw Materials inventory 1223
(Use of direct materials)
Nov 3. Work-in-Process Inventory 460
Wages Payable 460
(Use of direct labor)
Nov 3. Work-in-Process Inventory 575
Manufacturing overhead 575
(Allocation of overhead)
3 Date Accounts Debit Credit
Nov 3. Finished goods inventory 2258
Work-in-Process Inventory 2258
(Completion of the job)
Nov 3. Accounts Receivable (5700*1.40) 7980
Sales Revenue 7980
(Revenue portion of the sale of Job)
Nov 3. Cost of goods sold 2258
Finished goods inventory 2258
(Cost of goods portion of the sale)

ekkarill92 answered 1 year ago
Next > < Previous

Related Solutions

Lu Technology Co. manufactures DVDs for computer software and entertainment companies. Lu uses job order costing....
Lu Technology Co. manufactures DVDs for computer software and entertainment companies. Lu uses job order costing. On June 2,Lu began production of 5,800 ​DVDs, Job​ 423, for Portrait Pictures for $1.20 sales price per DVD. Lu promised to deliver the DVDs to Portrait Pictures by June 5. Lu incurred the following direct​ costs: Data table: Date Labor Time Record No. Description Amount 6/02 655 10 hours @ $14 per hour $140 6/03 656 20 hours @ $13 per hour 260...
True Technology Co. manufactures CDs and DVDs for computer software and entertainment companies. True uses job...
True Technology Co. manufactures CDs and DVDs for computer software and entertainment companies. True uses job order costing. On September ​2, True began production of 5,000 ​DVDs, Job​ 423, for Paradigm Pictures for $ 1.80 sales price per DVD. True promised to deliver the DVDs to Paradigm Pictures by September 5. True incurred the following​ costs: Date Labor Time Record No. Description Amount 9/02 655 10 hours @ $14 per hour $140 9/03 656 20 hours @$13 per hour $260...
Coronado, Inc. manufactures ergonomically designed computer furniture. Coronado uses a job order costing system. On November...
Coronado, Inc. manufactures ergonomically designed computer furniture. Coronado uses a job order costing system. On November 30, the Work in Process Inventory consisted of the following jobs: Job No. Item Units Accumulated Cost CC723 Computer caddy 26,000 $970,000 CH291 Chair 19,000 434,000 PS812 Printer stand 29,000 268,000 $1,672,000 On November 30, Coronado’s Raw Materials Inventory account totaled $686,000, and its Finished Goods Inventory totaled $3,476,400. Coronado applies manufacturing overhead on the basis of machine hours. The company’s manufacturing overhead budget...
Marigold, Inc. manufactures ergonomically designed computer furniture. Marigold uses a job order costing system. On November...
Marigold, Inc. manufactures ergonomically designed computer furniture. Marigold uses a job order costing system. On November 30, the Work in Process Inventory consisted of the following jobs: Job No. Item Units Accumulated Cost CC723 Computer caddy 22,000 $970,000 CH291 Chair 15,000 440,000 PS812 Printer stand 26,000 286,000 $1,696,000 On November 30, Marigold’s Raw Materials Inventory account totaled $685,000, and its Finished Goods Inventory totaled $3,486,400. Marigold applies manufacturing overhead on the basis of machine hours. The company’s manufacturing overhead budget...
Bonita, Inc. manufactures ergonomically designed computer furniture. Bonita uses a job order costing system. On November...
Bonita, Inc. manufactures ergonomically designed computer furniture. Bonita uses a job order costing system. On November 30, the Work in Process Inventory consisted of the following jobs: Job No. Item Units Accumulated Cost CC723 Computer caddy 21,000 $1,000,000 CH291 Chair 20,000 436,000 PS812 Printer stand 25,000 257,000 $1,693,000 On November 30, Bonita’s Raw Materials Inventory account totaled $676,000, and its Finished Goods Inventory totaled $3,456,400. Bonita applies manufacturing overhead on the basis of machine hours. The company’s manufacturing overhead budget...
Thing Co. uses a job order costing system. At the beginning of July, the company had...
Thing Co. uses a job order costing system. At the beginning of July, the company had the following job in progress: Job 70 $16539 During July, Thing Co. incurred the following job related costs: Direct Materials Direct Labour Job 70 $2740 $1163 Job 80 12316 16294 Job 90 8248 7908 Manufacturing overhead is applied at a rate of $3.79 per $1 of direct labour cost. Jobs 70 and 90 were moved to finished goods during the month, but neither was...
Teledex Company manufactures product to customers’ specification and uses a job-order costing system. The company uses...
Teledex Company manufactures product to customers’ specification and uses a job-order costing system. The company uses a plantwide predetermined overhead rate based on direct labor cost to apply its manufacturing overhead(assumed to be all fixed) to jobs. The following estimates were made at the beginning of the year. Department Fabricating Machining Assembly Total Plant Manufacturing overhead 350,000 400,000 90,000 840,000 Direct Labor 200,000 100,000 300,000 600,000 Jobs require varying amounts of work in the three departments. The coopers job, for...
Overhead Application and Job-Order Costing Heurion Company is a job-order costing firm that uses a plantwide...
Overhead Application and Job-Order Costing Heurion Company is a job-order costing firm that uses a plantwide overhead rate based on direct labor hours. Estimated information for the year is as follows: Overhead $789,000 Direct labor hours 100,000 Heurion worked on five jobs in July. Data are as follows: Job 741 Job 742 Job 743 Job 744 Job 745 Balance, July 1 $29,870 $55,215 $27,880 $0 $0 Direct materials $25,500 $39,800 $14,450 $13,600 $8,420 Direct labor cost $61,300 $48,500 $28,700 $24,500...
Job Order Costing: Wadadli Products uses a job-order costing system Overhead costs are applied to jobs...
Job Order Costing: Wadadli Products uses a job-order costing system Overhead costs are applied to jobs on the basis of machine-hours. At the beginning of the year, management estimated that 170,000 machine-hours would be required for the periods estimated level of production. The company also estimated $212,500 of fixed manufacturing overhead expenses for the coming period and variable manufacturing overhead of $1.50 per machine hour. Required: 1. Compute the company’s predetermined overhead rate. 2. Assume that during the year of...
URGENT Mason Engineering manufactures audio devices for cars and uses job order costing. There are two...
URGENT Mason Engineering manufactures audio devices for cars and uses job order costing. There are two departments. In Department A, overhead is applied on the basis of machine-hours, and in Department B, on the basis of direct labor hours. At the start of the current year, the following budget estimates were developed in order to compute the overhead application rates: Department A Department B Direct labor $420,000 $300,000 Manufacturing overhead $540,000 $412,500 Machine-hours 19,000 2,000 Direct labor hours 26,000 24,000...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT