Question

Jurvin Enterprises is a manufacturing company that had no beginning inventories. A subset of the transactions that it recorded during a recent month is shown below.

a.$76,600 in raw materials were purchased for cash.

b.$72,700 in raw materials were used in production. Of this amount, $65,400 was for direct materials and the remainder was for indirect materials.

c.Total labor wages of $150,900 were incurred and paid. Of this amount, $134,400 was for direct labor and the remainder was for indirect labor.

d.Additional manufacturing overhead costs of $126,400 were incurred and paid.

e.Manufacturing overhead of $124,200 was applied to production using the company’s predetermined overhead rate.

f.All of the jobs in process at the end of the month were completed.

g.All of the completed jobs were shipped to customers.

h.Any underapplied or overapplied overhead for the period was closed to Cost of Goods Sold.

Required:

1. Post the above transactions to T-accounts.

2. Determine the adjusted cost of goods sold for the period.

Answer 1

Cash		Raw Materials
Beg. Bal.		a.	76600	Beg. Bal.
		c.	150900	a.	76600	b.	72700
		d.	126400
End. Bal.			$353900	End. Bal.	$3900
Work in Process	Finished Goods
Beg. Bal.				Beg. Bal.
b.	65400	f.	324000	f.	324000	g.	324000
c.	134400
e.	124200
End. Bal.	$0			End. Bal.	$0
Manufacturing Overhead	Cost of Goods Sold
Beg. Bal.				Beg. Bal.
b.	7300	e.	124200	g	324000
c.	16500	h.	26000	h	26000
d.	126400
End. Bal.	$0			End. Bal.	$350000

Actual manufacturing overhead= $7300+16500+126400= $150200

Underapplied or overapplied overhead= Actual manufacturing overhead-Applied manufacturing overhead

= $150200-124200= $26000 underapplied

Required 2

Adjusted cost of goods sold= $324000+26000= $350000