Question

Analyzing Manufacturing Cost Accounts

Fire Rock Company manufactures designer paddle boards in a wide variety of sizes and styles. The following incomplete ledger accounts refer to transactions that are summarized for June:

Materials
June 1	Balance	30,100	June 30	Requisitions	(A)
June 30	Purchases	120,800

Work in Process
June 1	Balance	(B)	June 30	Completed jobs	(F)
June 30	Materials	(C)
June 30	Direct labor	(D)
June 30	Factory overhead applied	(E)

Finished Goods
June 1	Balance	0	June 30	Cost of goods sold	(G)
June 30	Completed jobs	(F)

Wages Payable
			June 30	Wages incurred	115,000

Factory Overhead
June 1	Balance	20,800	June 30	Factory overhead applied	(E)
June 30	Indirect labor	(H)
June 30	Indirect materials	16,100
June 30	Other overhead	81,200

In addition, the following information is available:

a. Materials and direct labor were applied to six jobs in July:

Job No.		Style	Quantity		Direct Materials				Direct Labor
201		T100	170			$17,750				$13,000
202		T200	390			35,420				26,000
203		T400	190			13,820				8,000
204		S200	270			37,260				27,000
205		T300	150			17,800				14,000
206		S100	130			6,510				4,000
		Total	1,300			$128,560				$92,000

b. Factory overhead is applied to each job at a rate of 150% of direct labor cost.

c. The June 1 Work in Process balance consisted of two jobs, as follows:

Job No.	Style	Work in Process, June 1
201	T100	$5,000
202	T200	15,800
Total		$20,800

d. Customer jobs completed and units sold in July were as follows:

Job No.	Style	Completed in July	Units Sold in July
201	T100	X	136
202	T200	X	312
203	T400		0
204	S200	X	227
205	T300	X	125
206	S100		0

1. Determine the missing amounts associated with each letter and complete the following table. If required, round amounts to the nearest dollar. If an answer is zero, enter in "0". Enter all amounts as positive numbers.

Job No.	Quantity	June 1 Work in Process		Direct Materials		Direct Labor		Factory Overhead		Total Cost		Unit Cost		Units Sold	Cost of Goods Sold
No. 201		$ 5,000		$ 17,750		$ 13,000		$		$		$				$
No. 202		15,800		35,420		26,000
No. 203				13,820		8,000
No. 204				37,260		27,000
No. 205				17,800		14,000
No. 206				6,510		4,000
Total		$20,800		128,560		92,000		$		$						$

a. Materials Requisitions $

b. Work in Process Beginning Balance $

c. Direct Materials $

d. Direct Labor $

e. Factory overhead applied $

f. Completed jobs $

g. Cost of goods sold $

h. Indirect labor $

2. Determine the June 30 balances for each of the inventory accounts and factory overhead. Use the minus sign to indicate any credit balances.

Materials:	$
Work in Process:	$
Finished Goods:	$
Factory Overhead:	$

Answer 1

Materials
Jun-01	Balance	30,100	Jun-30	Requisitions	128,560
Jun-30	Purchases	120,800	Jun-30	Ending balance (30100+120800-128560)	22,340
Work in Process
Jun-01	Balance	20,800	Jun-30	Completed jobs (55250+116220+104760+52800)	329030
Jun-30	Materials	128,560	Jun-30	Ending balance (33820+16510)	50,330
Jun-30	Direct labor	92,000
Jun-30	Factory overhead applied	138,000
Finished Goods
Jun-01	Balance	0	Jun-30	Cost of goods sold	269,252
Jun-30	Completed jobs	329030		Ending balance (329030-269252)	59778
Wages Payable
			Jun-30	Wages incurred	115,000
Factory Overhead
Jun-01	Balance	20,800	Jun-30	Factory overhead applied	138,000
Jun-30	Indirect labor (115000-92000)	23000		Ending balance (20800+23000+16100+81200-138000)	3100
Jun-30	Indirect materials	16,100
Jun-30	Other overhead	81,200
All ending balance is debit Side.

Job No.	Quantity	Jun-01	Direct	Direct	Factory	Total Cost	Unit Cost (Total Cost / Quantity)	Units Sold	Cost of Goods Sold	Job Status
		Work in	Materials	Labor	Overhead
		Process
No. 201	170	5,000	17,750	13,000	19,500	55,250	325	136	44,200	Completed
No. 202	390	15,800	35,420	26,000	39,000	116,220	298	312	92,976	Completed
No. 203	190		13,820	8,000	12,000	33,820	178	0	-	In Progress
No. 204	270		37,260	27,000	40,500	104,760	388	227	88,076	Completed
No. 205	150		17,800	14,000	21,000	52,800	352	125	44,000	Completed
No. 206	130		6,510	4,000	6,000	16,510	127	0	-	In Progress
Total	1,300	20,800	128,560	92,000	138,000	379,360			269,252

a. Materials Requisitions $			128,560
b. Work in Process Beginning Balance $			20,800
c. Direct Materials $			128,560
d. Direct Labor $			92,000
e. Factory overhead applied $			138,000
f. Completed jobs $			329,030
g. Cost of goods sold $			269,252
h. Indirect labor $			23,000
Materials:		Debit balance	22,340
Work in Process:		Debit balance	50,330
Finished Goods:		Debit balance	59778
Factory Overhead:		Debit balance	3100