Question

Ensign Landscape Design designs landscape plans and plants the material for clients. On April 1, there were three jobs in process, Jobs 39, 40, and 41. During April, two more jobs were started, Jobs 42 and 43. By April 30, Jobs 40, 41, and 43 were completed and sold. The following data were gathered:

	Job 39	Job 40	Job 41	Job 42	Job 43
Balance, April 1	$500	$3,370	$3,010	—	—
Direct materials	650	530	350	$3,450	$6,890
Direct labor	550	590	520	2,490	2,980

Overhead is applied at the rate of 110% of direct labor cost. Jobs are sold at cost plus 30%. Selling and administrative expenses for April totaled $4,575. (Round all amounts to the nearest dollar.)

	Required:
1.	Prepare job-order cost sheets for each job as of April 30.
2.	Calculate the ending balance in Work in Process (as of April 30) and Cost of Goods Sold for April.
3.	Construct an income statement for Ensign Landscape Design for the month of April.

Labels and Amount Descriptions

Refer to the list below for the exact wording of text items within your job-cost sheets and income statement.

Labels
Add
Less
Amount Descriptions
Applied overhead
Beginning balance
Cost of goods sold
Direct labor
Direct materials
Gross margin
Operating income
Operating loss
Sales
Selling and administrative expenses
Total

Job-Order Cost Sheets

1. Prepare job-order cost sheets for each job as of April 30. Refer to the list of Labels and Amount Descriptions for the exact wording of text items within your job-cost sheets.

Ensign Landscape Design

Job-Order Cost Sheets

For the Month of April

1		Job 39	Job 40	Job 41	Job 42	Job 43
2	Beginning balance
3
4
5
6

Calculations

2. Calculate the ending balance in Work in Process (as of April 30) and Cost of Goods Sold for April.

Ending Balance in Work in Process
Cost of Goods Sold for April

Income Statement

3. Construct an income statement for Ensign Landscape Design for the month of April. Refer to the list of Labels and Amount Descriptions for the exact wording of text items within your income statement. If a net loss has been incurred, enter that amount as a negative number using a minus sign.

Ensign Landscape Design

Income Statement

For the Month Ended April 30

1
2
3
4
5
6

Answer 1

1. Prepare job-order cost sheets for each job as of April 30. Refer to the list of Labels and Amount Descriptions for the exact wording of text items within your job-cost sheets.

Ensign Landscape Design

Job-Order Cost Sheets

For the Month of April

1		Job 39	Job 40	Job 41	Job 42	Job 43
2	Beginning balance	500	3370	3010
3	Direct material	650	530	350	3450	6890
4	Direct labor	550	590	520	2490	2980
5	Overhead	605	649	572	2739	3278
6	Total	2305	5139	4452	8679	13148

Calculations

2. Calculate the ending balance in Work in Process (as of April 30) and Cost of Goods Sold for April.

Ending Balance in Work in Process	2305+8679 = 10984
Cost of Goods Sold for April	5139+4452+13148 = 22739

Income Statement

3. Construct an income statement for Ensign Landscape Design for the month of April. Refer to the list of Labels and Amount Descriptions for the exact wording of text items within your income statement. If a net loss has been incurred, enter that amount as a negative number using a minus sign.

Ensign Landscape Design

Income Statement

For the Month Ended April 30

1	Sales revenue (22739*1.3)	29560.70
2	Cost of goods sold	22739
3	Gross margin	6821.70
4	Selling and administrative expense	-4575
5	Operating income	2246.70
6