Ch 3 InClass Practice Problems (2).docx

The searider company uses a job order costing system

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3. The Searider Company uses a job-order costing system. The following transactions occurred in April: a. Raw materials were purchased on account, $180,000. b. Raw materials used in production, $148,000 ($130,000 direct materials and $18,000 indirect materials). c. Accrued direct labor cost of $75,000 and indirect labor cost of $105,000. d. Depreciation recorded on factory equipment, $40,000. e. Other manufacturing overhead costs accrued during April, $118,000. f. The company applies manufacturing overhead cost to production using a predetermined overhead rate of $6 per machine-hours. A total of 46,000 machine-hours were used in April. g. Jobs costing $495,000 according to their job cost sheets were completed during April and transferred to Finished Goods. h. Jobs that had cost $450,000 to complete according to their job cost sheets were shipped to customers during the month. These jobs were sold on account at 30% above cost. Required : 1. Prepare journal entries to record the transactions given above. 2. Prepare T-accounts for Manufacturing Overhead and Work in Process. Post the relevant transactions from above to each account. Compute the ending balance in each account, assuming that Work in Process has a beginning balance of $39,000.
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4. The following data from the just completed year are taken from the accounting records of Kenton Company: Sales $ 975,000 Direct labor cost $ 165,000 Raw material purchases $ 229,000 Selling expense $ 48,750 Administrative expenses $ 146,250 Manufacturing overhead applied to work in process $ 180,000 Actual manufacturing overhead costs $ 175,050 Inventories: Beginning Ending Raw materials $ 18,000 $ 17,500 Work in process $ 20,000 $ 14,750 Finished goods $ 9,000 $ 11,000 Required : 1. Prepare a schedule of cost of goods manufactured. Assume all raw materials used in production were direct materials. 2. Prepare a schedule of cost of goods sold. Assume that the company’s underapplied or overapplied overhead is closed to Cost of Goods Sold.
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  • Spring '14
  • HenghsiuLin
  • Supply chain management terms, overhead costs, Finished Goods

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