Question

1.Superior Company provided the following data for the year ended December 31 (all raw materials are used in production as direct materials):

Selling expenses	$	219,000
Purchases of raw materials	$	261,000
Direct labor		?
Administrative expenses	$	159,000
Manufacturing overhead applied to work in process	$	369,000
Actual manufacturing overhead cost	$	356,000

Inventory balances at the beginning and end of the year were as follows:

	Beginning of Year			End of Year
Raw materials	$	59,000		$	36,000
Work in process		?		$	24,000
Finished goods	$	36,000			?

The total manufacturing costs for the year were $680,000; the cost of goods available for sale totaled $740,000; the unadjusted cost of goods sold totaled $662,000; and the net operating income was $38,000. The company’s underapplied or overapplied overhead is closed to Cost of Goods Sold.

Required:

Prepare schedules of cost of goods manufactured and cost of goods sold and an income statement. (Hint: Prepare the income statement and schedule of cost of goods sold first followed by the schedule of cost of goods manufactured.)

2.Gitano Products operates a job-order costing system and applies overhead cost to jobs on the basis of direct materials used in production (not on the basis of raw materials purchased). Its predetermined overhead rate was based on a cost formula that estimated $122,200 of manufacturing overhead for an estimated allocation base of $94,000 direct material dollars to be used in production. The company has provided the following data for the just completed year:

Purchase of raw materials	$	136,000
Direct labor cost	$	90,000
Manufacturing overhead costs:
Indirect labor	$	119,700
Property taxes	$	8,900
Depreciation of equipment	$	16,000
Maintenance	$	12,000
Insurance	$	7,200
Rent, building	$	33,000

	Beginning		Ending
Raw Materials	$	26,000	$	14,000
Work in Process	$	48,000	$	38,000
Finished Goods	$	70,000	$	61,000

Required:

2a. Compute the predetermined overhead rate for the year.

2b. Compute the amount of underapplied or overapplied overhead for the year.

2c. Prepare a schedule of cost of goods manufactured for the year. Assume all raw materials are used in production as direct materials.

2d. Compute the unadjusted cost of goods sold for the year. Do not include any underapplied or overapplied overhead in your answer.

2e. Assume that the $38,000 ending balance in Work in Process includes $8,900 of direct materials. Given this assumption, supply the information missing below:

3.

Froya Fabrikker A/S of Bergen, Norway, is a small company that manufactures specialty heavy equipment for use in North Sea oil fields. The company uses a job-order costing system that applies manufacturing overhead cost to jobs on the basis of direct labor-hours. Its predetermined overhead rate was based on a cost formula that estimated $372,000 of manufacturing overhead for an estimated allocation base of 1,200 direct labor-hours. The following transactions took place during the year:

1. Raw materials purchased on account, $240,000.
2. Raw materials used in production (all direct materials), $225,000.
3. Utility bills incurred on account, $67,000 (95% related to factory operations, and the remainder related to selling and administrative activities).
4. Accrued salary and wage costs:

Direct labor (1,275 hours)	$	270,000
Indirect labor	$	98,000
Selling and administrative salaries	$	150,000

5. Maintenance costs incurred on account in the factory, $62,000
6. Advertising costs incurred on account, $144,000.
7. Depreciation was recorded for the year, $80,000 (85% related to factory equipment, and the remainder related to selling and administrative equipment).
8. Rental cost incurred on account, $105,000 (90% related to factory facilities, and the remainder related to selling and administrative facilities).
9. Manufacturing overhead cost was applied to jobs, $ ? .
10. Cost of goods manufactured for the year, $850,000.
11. Sales for the year (all on account) totaled $1,600,000. These goods cost $880,000 according to their job cost sheets.

The balances in the inventory accounts at the beginning of the year were:

Raw Materials	$	38,000
Work in Process	$	29,000
Finished Goods	$	68,000

Required:

1. Prepare journal entries to record the preceding transactions.

2. Post your entries to T-accounts. (Don’t forget to enter the beginning inventory balances above.)

3. Prepare a schedule of cost of goods manufactured.

4A. Prepare a journal entry to close any balance in the Manufacturing Overhead account to Cost of Goods Sold.

4B. Prepare a schedule of cost of goods sold.

5. Prepare an income statement for the year.

Answer 1

Sorry to say I am posting answer to the first question , as experts are instructed to answer the very first question if student posts multiple questions. Also the last question is extremely long.Please post the other two in different posts

Schedule of Cost of Goods Manufactured
Direct Materials:
Raw Materials inventory,beginning					59,000
Add:purchases of raw materials					261,000
total raw materials available					320,000
Deduct:Raw materials inventory ,ending					36,000
Raw Materials used in production						284,000
Direct Labor						27,000
Manufacturing overhead Applied to WIP						369,000
total manufacturing costs						680,000
Add:Beginning work in process inventory						48,000
						728,000
Deduct:Ending work in process inventory						24,000
Cost of goods manufactured						704,000
Schedule of Cost of Goods sold
Finished goods inventory,beginning						36,000
Add:Cost of goods manuactured						704,000
Cost of goods available for sale						740,000
Deduct:Finished goods inventory,ending						78,000
Unadjusted cost of goods sold						662,000
less::overapplied overhead						13000
Adjusted cost of goods sold						649,000
Income statement
Sales						1,065,000
cost of good sold						649,000
Gross margin						416,000
Selling and administrative expense
Selling expenses					219,000
Administrative expense					159,000	378,000
Net operating income						38,000