Question

In: Accounting

Tybee Industries Inc. uses a job order cost system. The following data summarize the operations related...

Tybee Industries Inc. uses a job order cost system. The following data summarize the operations related to production for January, the first month of operations:

a. Materials purchased on account, $29,800.
b. Materials requisitioned and factory labor used:
Job Materials Factory Labor
301 $ 2,960 $2,775
302 3,620 3,750
303 2,400 1,875
304 8,100 6,860
305 5,100 5,250
306 3,750 3,340
For general factory use 1,080 4,100
c. Factory overhead costs incurred on account, $5,500.
d. Depreciation of machinery and equipment, $1,980.
e. The factory overhead rate is $54 per machine hour. Machine hours used:
Job Machine Hours
301 25
302 36
303 30
304 72
305 40
306 25
Total 228
f. Jobs completed: 301, 302, 303 and 305.
g. Jobs were shipped and customers were billed as follows: Job 301, $8,250; Job 302, $11,200; Job 303, $15,000.
Required:
1. Journalize the entries to record the summarized operations. Record each item (items a-f) as an individual entry on January 31. Record item g as 2 entries. Refer to the Chart of Accounts for exact wording of account titles.
2. Post the appropriate entries to T accounts for Work in Process and Finished Goods, using the identifying letters as transaction codes. Insert memo account balances as of the end of the month.
3. Prepare a schedule of unfinished jobs to support the balance in the work in process account.*
4. Prepare a schedule of completed jobs on hand to support the balance in the finished goods account.*
* Refer to the list of Amount Descriptions for the exact wording of the answer choices for text entries.

Chart of Accounts

CHART OF ACCOUNTS
Tybee Industries Inc.
General Ledger
ASSETS
110 Cash
121 Accounts Receivable
125 Notes Receivable
126 Interest Receivable
131 Materials
132 Work in Process
133 Factory Overhead
134 Finished Goods
141 Supplies
142 Prepaid Insurance
143 Prepaid Expenses
181 Land
191 Machinery and Equipment
192 Accumulated Depreciation-Machinery and Equipment
LIABILITIES
210 Accounts Payable
221 Utilities Payable
231 Notes Payable
236 Interest Payable
241 Lease Payable
251 Wages Payable
252 Consultant Fees Payable
EQUITY
311 Common Stock
340 Retained Earnings
351 Dividends
390 Income Summary
REVENUE
410 Sales
610 Interest Revenue
EXPENSES
510 Cost of Goods Sold
520 Wages Expense
531 Selling Expenses
532 Insurance Expense
533 Utilities Expense
534 Office Supplies Expense
540 Administrative Expenses
561 Depreciation Expense-Machinery and Equipment
590 Miscellaneous Expense
710 Interest Expense

Amount Descriptions

Amount Descriptions
Job No. 301
Job No. 302
Job No. 303
Job No. 304
Job No. 305
Job No. 306

Journal

1. Journalize the entries to record the summarized operations. Record each item (items a-f) as an individual entry on January 31. Record item g as 2 entries. Refer to the Chart of Accounts for exact wording of account titles.

PAGE 10

JOURNAL

ACCOUNTING EQUATION

DATE DESCRIPTION POST. REF. DEBIT CREDIT ASSETS LIABILITIES EQUITY

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

T Accounts

2. Post the appropriate entries to T accounts for Work in Process and Finished Goods, using the identifying letters as transaction codes. Insert memo account balances as of the end of the month.

Work in Process
Bal.
Finished Goods
Bal.

Schedule of Unfinished Jobs

3. Prepare a schedule of unfinished jobs to support the balance in the work in process account. Refer to the list of Amount Descriptions for the exact wording of the answer choices for text entries.

Tybee Industries Inc.

Schedule of Unfinished Jobs

1

Job

Direct Materials

Direct Labor

Factory Overhead

Total

2

3

4

Balance of Work in Process, January 30

Schedule of Completed Jobs

4. Prepare a schedule of completed jobs on hand to support the balance in the finished goods account. Refer to the list of Amount Descriptions list for the exact wording of the answer choices for text entries.

Tybee Industries Inc.

Schedule of Completed Jobs

1

Job

Direct Materials

Direct Labor

Factory Overhead

Total

2

Solutions

Expert Solution

JOURNAL

ACCOUNTING EQUATION

DATE

DESCRIPTION

POST. REF.

DEBIT

CREDIT

ASSETS

LIABILITIES

EQUITY

1

Jan-31

Materials

$     29,800

$     29,800

$     29,800

Accounts Payable

$    29,800

2

Jan-31

Work in Progress

$     54,960

-

Materials

$     27,010

Factory Labor

$     27,950

3

Jan-31

Factory Overhead Costs

$      5,500

$      5,500

$     (5,500)

Accounts Payable

$      5,500

4

Jan-31

Depreciation

$      1,980

$     (1,980)

$     (1,980)

Machinery

$      1,980

5

No entry for overhead rate

6

Jan-31

Finished Goods

$     36,015

-

Work in Progress

$     28,941

Factory Overhead

$      7,074

Job Completed

301

302

303

305

Direct Material

$        2,960

$        3,620

$        2,400

$          5,100

Factory Labor

$        2,775

$        3,750

$        1,875

$          5,250

$        6,036

$        7,672

$        4,578

$        10,655

$        28,941

Machine Hours

$              25

$              36

$              30

$                40

Factory Overhead Rate

$              54

$              54

$              54

$                54

Factory Overhead Allocated

$        1,350

$        1,944

$        1,620

$          2,160

$          7,074


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