Question

Supreme Videos, Inc., produces short musical videos for sale to retail outlets. The company's balance sheet accounts as of January 1 are given below. $ 63,000 102.000 Supreme Videos, Ine. Balance Sheet January 1 Assets Current assets! Cash Accounts receivable Inventories: Raw materials (film, costumes) $ 30,000 Videos in process 45.000 Finished videos awaiting sale 81,000 Prepaid insurance Total current assets Studio and equipment 730.000 Less accumulated depreciation 210.000 Total assets Liabilities and Stockholders' Equity Mccounts payable Capital stock $420,000 Retained earnings 270.000 Total liabilities and stockholders' equity 156.000 9.000 330,000 520,000 S850,000 $160.000 690,000 $850,000 Because the videos differ in length and in complexity of production, the company uses a job-order costing system to determine the cost of each video produced, Studio manufacturing) overhead is charged to videos on the basis of camera hours of activity. The company's predetermined overhead rate for the year is based on a cost formula that estimated $280,000 in manufacturing overhead for an estimated allocation base of 7,000 camera-hours. The following transactions occurred during the year: a. Film, costumes, and similar raw materials purchased on account. $185.000 b. Film, costumes, and other raw materials used in production, $200.000 (85% of this material was considered direct to the videos in production, and the other 15% was considered indirect) c. Utility costs incurred on account in the production studio, $72,000. d. Depreciation recorded on the studio, cameras, and other equipment, $84,000. Three-fourths of this depreciation related to production of the videos, and the remainder related to equipment used in marketing and administration, e Advertising expense incurred on account, $130,000 1 Costs for salaries and wages were incurred on account as follows:

Answer 1

Book1 - Microsoft Excel - X Home Insert Page Layout Formulas Data Review View * Cut Copy - General 1 D Wrap Text Merge & Center . 3 AutoSum" AT A Calibri - 11 - AA BI U - ->-A Paste Insert Delete Format Conditional Format Formatting as Table Styles Format Painter Clipboard Cell Styles 2 Clear Sort & Find & Filter Select Editing Font Alignment Number Cells fix A1 ГДА 44 E F G H I Cash Account 45 $ Balance b/d Accounts Receivable Total 63,000.00 Salaries and Wages 8,50,000.00 Balance C/d 9,13,000.00 $ $ $ 7,85,000.00 1,28,000.00 9,13,000.00 $ Accounts Receivable $ Balance b/d Sales Total 1,02,000.00 Cash 9,25,000.00 Balance C/d 10,27,000.00 $ $ $ 8,50,000.00 1,77,000.00 10,27,000.00 $ Balance b/d Accounts Payable Total Merchandise Inventory $ $ $ 30,000.00 By Video in Process 1,85,000.00 Balance C/d 2,15,000.00 $ $ $ 2,00,000.00 15,000.00 2,15,000.00 Prepaid Insurance $ Balance b/d 9,000.00 By Insurance Balance C/d 9,000.00 S 7,000.00 2,000.00 9,000.00 Total $ $ Video in Process 64 65 66 Balance b/d Merchandise Inventory($200000*85%) Sheet1 Sheet2 Sheet3 $200000*85%) 45,000.00 Finished Goods 1,70,000.00 Balance C/d $ $ 5,50,000.00 37,000.00 $ On Ready Average: 260957.0292 + Count: 363 Sum: 44623652 OO SA A 100% - ENG 0 16:35 06-02-2020 0 O .

Book1 - Microsoft Excel - X Home Insert Page Layout Formulas Data Review View * Cut Copy - General Wrap Text Merge & Center 1 1 - 3 Calibri - 11 - AA BI U - ->-A Autosum * Paste Insert Delete Format Conditional Format Formatting as Table Styles Cell Styles Format Painter Clipboard 2 Clear Sort & Filter Editing Find & Select Font Alignment Number Cells fic A1 ГДА 64 F G H I K Video in Process $ | $ 5,50,000.00 37,000.00 Balance b/d Merchandise Inventory($200000*85%) Direct Labor Overhead 45,000.00 Finished Goods 1,70,000.00 Balance C/d 82,000.00 2,90,000.00 $ $ Total $ 5,87,000.00 $ 5,87,000.00 Studio and Equipment $ Balance b/d 7,30,000.00 By Balance C/d $ 7,30,000.00 Total $ 7,30,000.00 $ 7,30,000.00 Balance b/d Video in Process Total Finished Goods $ $ $ 81,000.00 By Cost of good sold 5,50,000.00 By Balance C/d 6,31,000.00 $ $ $ 6,00,000.00 31,000.00 6,31,000.00 85 To Balance C/d Accumulated Depreciation $ 2,94,000.00 By Balance b/d By Depreciation 86 $ $ Ć 2,10,000.00 84,000.00 2010 non . Sheet1 Sheet2 Sheet30 Ke Ready Average: 260957.0292 Count: 363 Sum: 44623652 DO 100% + 0 16:35 06-02-2020 SA A O ENG W

Book1 - Microsoft Excel - X Home Insert Page Layout Formulas Data Review View * Cut Copy - General 1 D Wrap Text Merge & Center . 3 AutoSum" AT A Calibri - 11 - AA BI U - ->-A Paste Insert Delete Format Conditional Format Formatting as Table Styles Format Painter Clipboard Cell Styles 2 Clear Sort & Find & Filter Select Editing Font Alignment Number Cells A1 ГДА 84 85 F G H I To Balance C/d Accumulated Depreciation $ 2,94,000.00 By Balance b/d By Depreciation $ 2,94,000.00 $ $ $ 2,10,000.00 84,000.00 2,94,000.00 Total Studio Overhead $ 2,90,000.00 Indirect Material($200000*15%) Utility Expenses Depreciation Indirect Labor Prepaid Insurance($8700*80%) To Cost of goods sold Total $ $ $ $ $ $ 30,000.00 By Video in Process 72,000.00 63,000.00 1,10,000.00 5,600.00 9,400.00 2,90,000.00 $ 2,90,000.00 Depreciation Expense $ To Accumulated Depreciation($84000*1/4) 21,000.00 By Balance C/d $ 21,000.00 Total | $ 21,000.00 $ 21,000.00 102 103 Insurance Expense $ 104 To Prepaid Insurance($7000*20%) 1,400.00 By Balance C/d $ 1,400.00 105 106 Total $ 1,400.00 $ 1,400.00 Sheet1 Sheet2 Sheet3 Ready Average: 260957.0292 Count: 363 Sum: 44623652 DO 100% - ENG 0 16:36 06-02-2020 SA A O 0

Book1 - Microsoft Excel - X Home Insert Page Layout Formulas Data Review View * Cut Copy - General Calibri - 11 - AA BI U - ->-A Wrap Text Merge & Center 1 1 conditional complete se - 3 Insert Delete Format 1-% ato de Autosum * 2 Clear Game Paste Format Painter Clipboard Insert Delete Format Conditional Format Formatting as Table Styles Cell Styles 2 Clear Sort & Filter Editing Find & Select Finde Font Alignment Number Cells A1 A c F G H I J K 2 108 Advertisement Expense $ 1,30,000.00 By Balance C/d To Accounts Payable $ 1,30,000.00 110 Total $ 1,30,000.00 $ 1,30,000.00 113 114 To Accounts Payable Miscellaneous Expense $ 8,600.00 By Balance C/d $ 8,600.00 Total $ 8,600.00 $ 8,500.00 117 Administrative Salaries Expense $ 95,000.00 By Balance C/d To Accounts Payable $ 95,000.00 Total $ 95,000.00 $ 95,000.00 Sales To Balance C/d $ 9,25,000.00 | By Accounts Receivable $ 9,25,000.00 Total $ 9,25,000.00 $ 9,25,000.00 Cost of goods sold $ 129 To Finished Goods 6,00,000.00 By Studio in Process By Balance C/d $ $ 9,400.00 5,90,600.00 130 Sheet1 Sheet2 Sheet30 Ke Ready Average: 260957.0292 100% + Count: 363 Sum: 44623652 OO SA A 0 16:36 06-02-2020 O ENG W

Book1 - Microsoft Excel - X Home Insert Page Layout Formulas Data Review View * Cut Copy - General Calibri - 11 - AA BI U - ->-A Wrap Text Merge & Center 1 D . 3 9-% , 18.4.3 conditional Format sett insert Delete Format AutoSum" AT A 2 Clear sort & Find & Paste Insert Delete Format Conditional Format Formatting as Table Styles Cell Styles Format Painter Clipboard 2 Clear Sort & Find & Filter Select Editing Font Alignment Number Cells A1 A F G H I 2 128 Cost of goods sold $ To Finished Goods 130 6,00,000.00 By Studio in Process By Balance C/d 6,00,000.00 $ $ $ 9,400.00 5,90,600.00 6,00,000.00 Total $ 132 To Finished Goods To Balance C/d Accounts Payable $ $ 136 5,00,000.00 By Balance b/d $ 55,600.00 By Merchandise Inventory | $ By Studio Overhead $ By Advertisement Expense $ By Miscellaneous Expense $ 1,60,000.00 1,85,000.00 72,000.00 1,30,000.00 8,500.00 Total $ 5,55,600.00 $ 5,55,600.00 Salaries & Wages Payable By Salaries and Wages $ 2,85,000.00 Expense $ 2,000.00 $ 2,87,000.00 $ To Cash To Balance C/d Total 2,87,000.00 $ 2,87,000.00 2 147 Capital Stock 148 149 $ 4,20,000.00 By Balance B/d $ 4,20,000.00 150l To Balance C/d Sheet1 Sheet2 Sheet3 Ready Average: 260957.0292 Count: 363 Sum: 44623652 OO 100% + 0 16:36 06-02-2020 SA A O ENG W

Book1 - Microsoft Excel - X Home Insert Page Layout Formulas Data Review View * Cut Copy - General Wrap Text Merge & Center 1 1 - 3 Calibri - 11 - AA BI U - ->-A Autosum * Paste Insert Delete Format Conditional Format Formatting as Table Styles Format Painter Clipboard Cell Styles 2 Clear Sort & Find & Filter Select Editing Font Alignment Number Cells fic A1 A F G H I 2 148 149 Capital Stock To Balance c/d $ 4,20,000.00 By Balance B/d $ 4,20,000.00 150 Retained Earnings $ To Balance C/d 2,70,000.00 By Balance B/d $ 2,70,000.00 Overhead is over applied by $9400 transferred to cost of goods sold Supreme Video Inc. Cost of Goods manuafactured 158 159 160 Amount 161 162 163 $ $ $ $ 30,000.00 1,85,000.00 2,15,000.00 15,000.00 165 166 Direct Material Beginning Raw Material Inventory Add: Purchases Total raw material available Less: Ending Raw Material Total raw material available Raw Material used in Production($200000*85%) Direct Labor Manuafcturing Overhead Indirect Material Indirart labor Sheet1 Sheet2 Sheet3 162 2,00,000.00 1,70,000.00 82,000.00 168 169 170 $ $ 30,000.00 11n non nn 171 Ready Average: 260957.0292 Count: 363 Sum: 44623652 OO 100% + 0 16:36 06-02-2020 SA A O ENG W

Book1 - Microsoft Excel - X Home Insert Page Layout Formulas Data Review View * Cut Copy - General 1 D Wrap Text Merge & Center . 3 AutoSum" AT A Calibri - 11 - AA BI U - ->-A Font Paste Insert Delete Format Conditional Format Formatting as Table Styles Format Painter Clipboard Cell Styles 2 Clear Sort & Find & Filter Select Editing Alignment Number Cells fic A1 A D E F G H I J Cost of Goods manuafactured 158 159 160 Amount 161 163 $ $ $ $ 30,000.00 1,85,000.00 2,15,000.00 -15,000.00 165 167 2,00,000.00 1,70,000.00 82,000.00 168 169 170 Direct Material Beginning Raw Material Inventory Add: Purchases Total raw material available Less: Ending Raw Material Total raw material available Raw Material used in Production($200000*85%) Direct Labor Manuafcturing Overhead Indirect Material Indirect Labor Utilties:Plant Depreciation: Plant & Equipment Other Total Manufacturing Overhead Total Manufacturing Cost Add: Work in Process January 1st, Total Less: Work in Process Ending Dec 31st Cost of goods manufactured 171 172 173 $ $ $ $ $ 30,000.00 1,10,000.00 72,000.00 63,000.00 15,000.00 174 175 176 177 178 179 180 181 W Ready 2,90,000.00 5,42,000.00 45,000.00 5,87,000.00 -37,000.00 5,50,000.00 Sheet1 Sheet2 Sheet3 Average: 260957.0292 Count: 363 Sum: 44623652 B O 100% - ENG 0 16:36 06-02-2020 SA A O 0

Book1 - Microsoft Excel - X Home Insert Page Layout Formulas Data Review View * Cut Copy - General 1 D Wrap Text Merge & Center . 3 AutoSum" AT A Calibri - 11 - AA BI U - ->-A Font Paste Insert Delete Format Conditional Format Formatting as Table Styles Format Painter Clipboard Cell Styles 2 Clear Sort & Find & Filter Select Editing Alignment Number Cells fic A1 A F G H I J 181 182 Supreme Video Inc. Cost of goods sold 183 184 185 186 187 188 189 Beginning Finished goods Inventory=(A) Add: Cost of goods manufactured=(B) Cost of goods available for sale(C)=(A)+(B) Less: Ending Finished goods Inventory=(D) Unadjusted cost of goods sold Less: Overapplied Overhead Adjusted cost of goods sold Amount $ 81,000.00 $ 5,50,000.00 $ 6,31,000.00 $ 31,000.00 $ 6,00,000.00 $ -9,400.00 $ 5,90,600.00 190 193 Supreme Video Inc. Income Statement 195 9,25,000.00 -5,90,600.00 3,34,400.00 196 197 198 199 Sales of Video Less: Cost of good sold Gross Margin Selling and Administrative Expense: Depreciation Expense Advertising Expense Administrative Salaries Insurance Expense Miscellaneous Expense Net Operating Income Sheet1 Sheet2 Sheet3 200 $ $ $ $ $ 201 21,000.00 1,30,000.00 95,000.00 1,400.00 8,600.00 $ $ 202 2,56,000.00 78,400.00 203 2017 Ready Average: 260957.0292 Count: 363 Sum: 44623652 B OU 100% + 0 16:36 06-02-2020 SA A O ENG W