Question

PROBLEM 2-3 Prepare entries in a job order cost system and cost of goods manufactured schedule. Case Inc. is a construction company specializing in custom patios. The patios are constructed of concrete, brick, fiberglass, and lumber, depending upon customer preference. On June 1, 2017, the general ledger for Case Inc. contains the following data. Raw Materials Inventory $4,200 Manufacturing Overhead Applied $32,640 Work in Process Inventory $5,540 Manufacturing Overhead Incurred $31,650 Subsidiary data for Work in Process Inventory on June 1 are as follows. Job Cost Sheets Customer Job Cost Element Rodgers Stevens Linton Direct materials S 600 S 800 S 900 Direct labor 320 540 580 Manufacturing overhead_400 6 75_725 $1,320 $2,015 $2,205 During June, raw materials purchased on account were $4.900, and all wages were paid. Additional overhead costs consisted of depreciation on equipment $900 and miscellaneous costs of $400 incurred on account. A summary of materials requisition slips and time tickets for June shows the following. Customer Job Materials Requisition Slips Time Tickets Rodgers $ 800 S 850 Koss 2,000 800 Stevens 500 360 Linton 1,200 Rodgers 300 390 4,900 3,600 General use 1,500 1,200 $6,400 $4,800 1,300 Overhead was charged to jobs at the same rate of $1.25 per dollar of direct labor cost. The patios for customers Rodgers, Stevens, and Linton were completed during June and sold for a total of $18.900. Each customer paid in full.

Answer 1

Date	Account titles and explanation	Debit	Credit
1	Raw materials	$4900
	Account payable		$4900
	(To record purchase of raw materials)
	Factory labor	$4800
	Cash		$4800
	(To record factory labor costs paid)
	Manufacturing overhead (900+400)	$1300
	Accumulated depreciation- Equipment		$900
	Account payable		$400
	(To record manufacturing overhead costs incurred)
2	Work in process inventory	$4900
	Manufacturing overhead	$1500
	Raw materials inventory		$6400
	(To record assignment of direct materials)
	Work in process inventory	$3600
	Manufacturing overhead	$1200
	Factory labor		$4800
	(To record assignment of factory labor)
	Work in process inventory (3600*1.25)	$4500
	Manufacturing overhead		$4500
	(To record assignment of manufacturing overhead)
3	Finished goods inventory	$14740
	Work in process inventory		$14740
	(To record completion of jobs)
	Cash	$18900
	Sales		$18900
	(To record sales of goods)
	Cost of goods sold	$14740
	Finished goods inventory		$14740
	(To record cost of goods sold)

Calculation of finished goods inventory= Direct materials+Direct labor+Manufacturing overhead

Rodgers= $(600+800+300)+(320+850+390)+(320+850+390)*1.25= $5210

Stevens= $(800+500)+(540+360)+(540+360)*1.25= $3325

Linton= $(900+1300)+(580+1200)+(580+1200)*1.25= $6205

Finished goods inventory= $5210+3325+6205= $14740

b)

Work in process Inventory
6/1	Balance	$5540	June	Completed work	$14740
	Direct materials	4900
	Direct labor	3600
	Manufacturing overhead	4500
6/30	Balance	$3800

c) Cost of Unfurnished Jobs: Koss- Direct materials $2000+Direct labor $800+Manufacturing overhead $1000 (800*$1.25)= $3800

d) k

CASE INC.
Cost of Goods Manufactured Schedule
For the Month Ended June 30, 2017
Work in process, June 1		$5540
Direct materials	4900
Direct labor	3600
Manufacturing overhead applied	4500
Total manufacturing costs		13000
Total cost of work in process		18540
Less: Work in inventory, June 30		(3800)
Cost of goods manufactured		$14740