Question

P3-49A Determine and record job costs (PP.166) Veon Homes manufactures prefabricated chalets in Colorado. The company uses a perpetual inventory system and a job cost system in which each chalet is a job. The following events occurred during May: a. Purchased materials on account, $490,000. b. Incurred total manufacturing wages of $115,000, which included both direct labor and indirect labor. Used direct labor in manufacturing as follows: Direct Labor Chalet 13 $14,200 Chalet 14 $28,500 Chalet 15 $19,900 Chalet 16 $21.900

Answer 1

CR DR $4,90,000.00 1 Particulars Raw material inventory Accounts payable To record purchase of material on account $4,90,000.00 =14200+28500+19900+21900 $ 84,500.00 $ 30,500.00 Work in progress inventory (wages) Manufacturing overhead Factory payroll To record direct and indirect wages $ 1,15,000.00 $2,27,000.00 -41400+56700+62400+66500 Work in progress inventry (materials) Raw material inventory To record issue of material for jobs $2,27,000.00 $ 6,300.00 Manufacturing overhead Depreciation-Plant & Equipment To record depreciation on plant & machinery $ 6,300.00 $ 18,600.00 Manufacturing overhead Cash Prepaid insurance To allocate cash paid and expired insurance to overhead $ $ 10,600.00 8,000.00 $ 50,700.00 Work in process inventory Manufacturing overhead To allocate overhead to WIP inventory account $ 50,700.00 $ 2,59,900.00 Finished goods inventory Work in process inventory To allocate WIP inventory completed to finished goods $ 2,59,900.00 Finished goods inventory Particulars Direct wages Direct material Direct overhead (60% of direct wages) Chalet 13 Chalet 15 Chalet 16 $ 14,200.00 $ 19,900.00 $ 21,900.00 $ 41,400.00 $ 62,400.00 $ 66,500.00 $ 8,520.00 $ 11,940.00 $ 13,140.00 Total Total finished goods inventory $ 64,120.00 $ 94,240.00 $1,01,540.00 2,59,900.00 1$ $2,33,000.00 Accounts receivable Sales revenue To allocate sale on account of job 13 and 16 $ 2,33,000.00 $1,65,660.00 Cost of goods sold Finished goods inventory To record cost of goods sale from inventory account of job 13 and 16 $1,65,660.00 Work in process inventory Particulars Direct wages Direct materials Direct overhead Total inventory transferred to finished goods Balance DR $ 84,500.00 $2,27,000.00 $ 50,700.00 Balance $ 84,500.00 $3,11,500.00 $3,62,200.00 $1,02,300.00 $ 1,02,300.00 $ 2,59,900.00 CR Finished goods inventory Particulars Transferred from WIP account Total inventory transferred to cost of goods sold Balance DR $ 2,59,900.00 Balance $2,59,900.00 $ 94,240.00 $ 94,240.00 $1,65,660.00 3 Direct materials Direct wages Direct overhead Total inventory in Chalet 14 $ 56,700.00 $ 28,500.00 $ 17,100.00 $1,02,300.00 =28500*60% 4 Direct materials Direct wages Direct overhead Total balance in Chalet 15 $ 62,400.00 $ 19,900.00 $ 11,940.00 $ 94,240.00 =19900*60% 5 Sales revenue Total cost Gross rofit of Chalet 13 $ 92,000.00 $ 64,120.00 $ 27,880.00 Sales revenue Total cost Gross rofit of Chalet 16 $ 1,41,999.00 $ 1,01,540.00 $ 39,460.00