ch02 - SOLUTIONS TO EXERCISESSET B EXERCISE 2-1B (a)...

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SOLUTIONS TO EXERCISES—SET B EXERCISE 2-1B (a) Factory Labor. ............................................................... 68,000 Factory Wages Payable. ....................................... 56,000 Employer Payroll Taxes Payable. ....................... 8,000 Employer Fringe Benefits Payable. .................... 4,000 (b) Work in Process Inventory ($68,000 X 85%). ............. 57,800 Manufacturing Overhead. ............................................ 10,200 Factory Labor. ....................................................... 68,000 EXERCISE 2-2B (a) May 31 Work in Process Inventory. ........................ 10,400 Manufacturing Overhead. ........................... 1,000 Raw Materials Inventory. .................... 11,400 31 Work in Process Inventory. ........................ 12,800 Manufacturing Overhead. ........................... 1,200 Factory Labor. ...................................... 14,000 31 Work in Process Inventory. ........................ 9,600 ($12,800 X 75%) Manufacturing Overhead. ................... 9,600 31 Finished Goods Inventory. ......................... 8,350 Work in Process Inventory. ................ 8,350 ($2,000 + $2,500 + $2,200 + $1,650)* *$2,200 X 75% (b) Work in Process Inventory May 1 Balance 3,200 31 10,400 31 12,800 31 9,600 May 31 8,350 May 31 Balance 27,650 © 2008 For Instructor Use Only 2-1
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EXERCISE 2-2B (Continued) Job Cost Sheets Job No. Beginning Work in Process Direct Material Direct Labor Manufacturing* Overhead Total 430 431 $1,200 0 $1,200 $3,500 4,400 $7,900 $ 3,000 7,600 $10,600 $2,250 5,700 $7,950 $ 9,950 17,700 $27,650 *Direct labor X .75 EXERCISE 2-3B (a) 1. $14,500, or ($4,000 + $6,000 + $4,500). 2. Last year 75%, or ($4,500 ÷ $6,000); this year 70% (either $5,600 ÷ $8,000 or $2,800 ÷ $4,000). (b) Jan. 31 Work in Process Inventory. ....................... 8,000 Raw Materials Inventory. ................... 8,000 31 Work in Process Inventory. ....................... 12,000 Factory Labor. ..................................... 12,000 31 Work in Process Inventory. ....................... 8,400 Manufacturing Overhead. .................. 8,400 31 Finished Goods Inventory. ........................ 42,900 Work in Process Inventory. ............... 42,900 EXERCISE 2-4B (a) + $50,000 + $40,000 = $135,650 (a) = $45,650 $135,650 + (b) = $211,500 (b) = $75,850 $211,500 – (c) = $192,300 (c) = $19,200 © 2008 For Instructor Use Only 2-2
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EXERCISE 2-4B (Continued) [Note : The instructions indicate that manufacturing overhead is applied on the basis of direct labor cost, and the rate is the same in all cases. From Case A, a student should note the overhead rate to be 80%, or ($40,000 ÷ $50,000).] (d) = .80 X $120,000 (d) = $96,000 $78,000 + $120,000 + $96,000 = (e) (e) = $294,000 $294,000 + $15,500 = (f) (f) = $309,500 $309,500 – $11,800 = (g) (g) = $297,700 [Note : (h) and (i) are solved together.] (i) = .80(h) $72,600 + (h) + .80(h) = $213,000 1.80(h) = $140,400 (h) = $78,000 (i) = $62,400 (j) = $213,000 + $23,000 (j) = $236,000
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ch02 - SOLUTIONS TO EXERCISESSET B EXERCISE 2-1B (a)...

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