Question

1a). The following information is available for the year ended December 31: The amount of raw materials used in production for the year is:

a. $4,100.

b. $5,100.

c. $3,500.

d. $6,500.

e. $4,000

1.b) Bard Manufacturing uses a job order cost accounting system. During one month Bard purchased $198,000 of raw materials on credit; issued materials to production of $195,000 of which $30,000 were indirect. Bard incurred a factory payroll of $150,000, paid in cash, of which $40,000 is classified as indirect labor. Bard uses a predetermined overhead application rate of 150% of direct labor cost. The journal entry to record the purchase of materials is:

a. Debit Raw Materials Inventory $198,000; credit Accounts Payable $198,000.

b. Debit Goods in Process Inventory $198,000; credit Accounts Payable $198,000.

c. Debit Raw Materials Inventory $198,000; credit Goods in Process Inventory $198,000.

d. Debit Goods in Process Inventory $195,000; credit Raw Materials Inventory $195,000.

e. Debit Raw Materials Inventory $198,000; credit Finished Goods Inventory $198,000.

1. c) Bard Manufacturing uses a job order cost accounting system. During one month Bard purchased $198,000 of raw materials on credit; issued materials to production of $195,000 of which $30,000 were indirect. Bard incurred a factory payroll of $150,000, paid in cash, of which $40,000 is classified as indirect labor. Bard uses a predetermined overhead application rate of 150% of direct labor cost. The journal entry to record the issuance of materials to production is:

a. Debit Raw Materials Inventory $195,000; credit Accounts Payable $195,000.

b. Debit Goods in Process Inventory $195,000; credit Raw Materials Inventory $195,000.

c. Debit Raw Materials Inventory $195,000; credit Goods in Process Inventory $195,000.

d. Debit Goods in Process Inventory $165,000; debit Factory Overhead $30,000; credit Raw Materials Inventory $195,000.

e. Debit Finished Goods Inventory $195,000; credit Raw Materials Inventory $195,000.

1.d) Bard Manufacturing uses a job order cost accounting system. During one month Bard purchased $198,000 of raw materials on credit; issued materials to production of $195,000 of which $30,000 were indirect. Bard incurred a factory payroll of $150,000, paid in cash, of which $40,000 is classified as indirect labor. Bard uses a predetermined overhead application rate of 150% of direct labor cost. The journal entry to record the application of factory overhead to production is:

a. Debit Goods in Process Inventory $225,000; credit Factory Overhead $225,000.

b. Debit Goods in Process Inventory $165,000; credit Factory Overhead $165,000.

c. Debit Factory Payroll $150,000; credit Goods in Process Inventory $150,000.

d. Debit Factory Overhead $165,000; credit Goods in Process Inventory $165,000.

e. Debit Goods in Process Inventory $165,000; credit Factory Payroll $165,000.

1.e) Bard Manufacturing uses a job order cost accounting system. During one month Bard purchased $198,000 of raw materials on credit; issued materials to production of $195,000 of which $30,000 were indirect. Bard incurred a factory payroll of $150,000, paid in cash, of which $40,000 is classified as indirect labor. Bard uses a predetermined overhead application rate of 150% of direct labor cost. Bard's beginning and ending Goods in Process Inventory are $15,500 and $27,000 respectively. Compute the cost of product transferred to Finished Goods Inventory:

a. $558,500.

b. $440,000.

c. $413,000.

d. $428,500.

e. $415,000.

Answer 1

1(a) : (question not complete)

Answer 1(b):

a. Debit Raw Materials Inventory $198,000; credit Accounts Payable $198,000

Answer 1 (c)

d. Debit Goods in Process Inventory $165,000; debit Factory Overhead $30,000; credit Raw Materials Inventory $195,000.

(being the entry for direct materials issued 165000 and indirect materials issued 30000)

Answer 1 (d):

b. Debit Goods in Process Inventory $165,000; credit Factory Overhead $165,000

(being the entry for factory overhead applied to production @ 150 % of direct labour cost 110000)

Answer 1(e):

d. $428,500.

(being the entry for cost of product transferred to finished goods, computed as below:

Opening inventory    15500

Direct materials    165000

Direct Labour              110000

Factory overheads       165000

Less closing inventory 27000

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cost of product             428500

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