Question

Marcelino Co.'s March 31 inventory of raw materials is $80,000. Raw materials purchases in April are $510,000, and factory payroll cost in April is $377,000. Overhead costs incurred in April are: indirect materials, $53,000; indirect labor, $22,000; factory rent, $39,000; factory utilities, $20,000; and factory equipment depreciation, $58,000. The predetermined overhead rate is 50% of direct labor cost. Job 306 is sold for $645,000 cash in April. Costs of the three jobs worked on in April follow.

	Job 306				Job 307				Job 308
Balances on March 31
Direct materials		$	30,000			$	36,000
Direct labor			22,000				16,000
Applied overhead			11,000				8,000
Costs during April
Direct materials			133,000				200,000			$	115,000
Direct labor			102,000				153,000				100,000
Applied overhead			?				?				?
Status on April 30	Finished (sold)				Finished (unsold)					In process

rev: 03_15_2018_QC_CS-121813

Materials purchases (on credit).

Direct materials used in production.

Direct labor paid and assigned to Work in Process Inventory.

Indirect labor paid and assigned to Factory Overhead.

Overhead costs applied to Work in Process Inventory.

Actual overhead costs incurred, including indirect materials. (Factory rent and utilities are paid in cash.)

Transfer of Jobs 306 and 307 to Finished Goods Inventory.

Cost of goods sold for Job 306.

Revenue from the sale of Job 306.

Assignment of any underapplied or overapplied overhead to the Cost of Goods Sold account. (The amount is not material.)

2. Prepare journal entries for the month of April to record the above transactions.
  

Answer 1

			Job 306	Job 307	Job 308	April
1)						total
From March
Direct materials			30,000	36,000	0	66,000
Direct labor			22,000	16,000	0	38,000
applied overhead			11,000	8,000	0	19,000
Beginning goods in process			63,000	60,000	0	123,000
For April
Direct materials			133,000	200,000	115,000	448,000
Direct labor			102,000	153,000	100,000	355,000
applied overhead			51000	76500	50000	177,500
Total costs added in April			286,000	429,500	265,000	980,500
total costs (April 30)			349,000	489,500	265,000	1,103,500
Satus on april 30			fin(sold)	fin(unsold)	in process
April costs included in :			COGS	finished	WIP
				goods
				inventory
2)	TR	General journal				Debit	Credit
	a.	Raw materials inventory				510,000
		Accounts payable					510,000
	b.	Work in process inventory				448,000
		Raw materials inventory					448,000
	c.	Work in process inventory				377,000
		Cash					377,000
	d.	Factory overhead				22,000
		cash					22,000
	e.	Factory overhead				177,500
		work in process inventory					177,500
	f.	Factory overhead				170,000
		Raw materials inventory					53,000
		Cash					59,000
		Accumulated Depreciation					58,000
	g.	finished goods inventory				838,500
		Work in process inventory					838,500
	h.	Cost of goods sold				349,000
		finished goods inventory					349,000
	i.	Cash				645,000
		sales					645,000
	j.	cost of goods sold				14,500
		Factory overhead					14,500