Question

Required information

[The following information applies to the questions displayed below.]

Marcelino Co.'s March 31 inventory of raw materials is $80,000. Raw materials purchases in April are $500,000, and factory payroll cost in April is $363,000. Overhead costs incurred in April are: indirect materials, $50,000; indirect labor, $23,000; factory rent, $32,000; factory utilities, $19,000; and factory equipment depreciation, $51,000. The predetermined overhead rate is 50% of direct labor cost. Job 306 is sold for $635,000 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		$	29,000			$	35,000
Direct labor			20,000				18,000
Applied overhead			10,000				9,000
Costs during April
Direct materials			135,000				220,000			$	100,000
Direct labor			85,000				150,000				105,000
Applied overhead			?				?				?
Status on April 30	Finished (sold)				Finished (unsold)					In process

1. Materials purchases (on credit).
2. Direct materials used in production.
3. Direct labor paid and assigned to Work in Process Inventory.
4. Indirect labor paid and assigned to Factory Overhead.
5. Overhead costs applied to Work in Process Inventory.
6. Actual overhead costs incurred, including indirect materials. (Factory rent and utilities are paid in cash.)
7. Transfer of Jobs 306 and 307 to Finished Goods Inventory.
8. Cost of goods sold for Job 306.
9. Revenue from the sale of Job 306.
10. 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.

Record the entry for Materials purchases (on credit).

Record the direct materials used in production.

Record the Direct labor paid and assigned to Work in Process Inventory.

Record the indirect labor paid and assigned to Factory Overhead.

Record the entry for Overhead costs applied to Work in Process Inventory.

Record the cost of indirect materials used.

Record the cost of factory utilities, paid in cash.

Record depreciation on factory equipment.
Record the cost of factory rent, paid in cash.

Record the entry for transfer of Jobs 306 and 307 to Finished Goods Inventory.

Record the Cost of goods sold for Job 306.

Record the revenue from the sale of job 306

Record the entry for assignment of any underapplied or overapplied overhead to the Cost of Goods Sold.

Answer 1

2)	TR	General journal				Debit	Credit
	a.	Raw materials inventory				500,000
		Accounts payable					500,000
	b.	Work in process inventory				455,000
		Raw materials inventory					455,000
	c.	Work in process inventory				340,000
		Cash					340,000
	d.	Factory overhead				23,000
		cash					23,000
	e.	Factory overhead				170,000
		work in process inventory					170,000
	f.	Factory overhead				50,000
		Raw materials ivnentory					50,000
		Factory overhead				19,000
		cash					19,000
		Factory overhead				51,000
		Accumulated depreciation					51,000
		Factory overhead				32,000
		cash					32,000
	g.	finished goods inventory				828,500
		Work in process inventory					828,500
	h.	Cost of goods sold				321,500
		finished goods inventory					321,500
	i.	Cash				635,000
		sales					635,000
	j.	cost of goods sold				5,000
		Factory overhead					5,000