Question

Dillon Products manufactures various machined parts to customer specifications. The company uses a job-order costing system and applles overhead cost to jobs on the basis of machine hours. At the beginning of the year, the company used a cost formula to estimate that it would incur $4.800.000 in manufacturing overhead cost at an activity level of 240.000 machine hours The company spent the entire month of January working on a large order for 16,000 custom-made machined parts. The company had no work in process at the beginning of January. Cost data relating to January follow a. Raw materials purchased on account. $325.000 b. Raw materials used in production, $290,000 (80% direct materials and 20% indirect materials Labor cost accrued in the factory, $180.000 (one-third direct labor and two-thirds indirect labor) d. Depreciation recorded on factory equipment. $75,000 e. Other manufacturing overhead costs incurred on account. $62.000 Manufacturing overhead cost was applied to production on the basis of 15.000 machine hours actually worked during the month 9. The completed job for 16,000 custom-made machined parts was moved into the finished goods warehouse on January 31 to wait delivery to the customer in computing the dollar amount for this entry, remember that the cost of a completed job consists of direct materials, direct labor, and applied overhead) Required: 1. Prepare journal entries to record Items (a) through (1) above lignore item al for the moment] 2. Prepare T-accounts for Manufacturing Overhead and Work in Process. Post the relevant items from your journal entries to these T- accounts 3. Prepare a journal entry for item ( above 4. 110.000 of the custom-made machined parts are shipped to the customer in February, how much of this job's cost will be included In cost of goods sold for February?

please do all the required parts (4) bexause it is all 1 question

$Three Homework accounts. 3. Prepare a journal entry for item (g) above. 4. \f 10,000 of the custom-made machined parts are sh$

Answer 1

Page No 0. S.NO Debit Credit $325000 $325000 $232000 $58000 Answer O Journal entries - Account title Raue materials Accounts payable wook. To process Manubacturing overhead Raw materials Manubachūring overhead woork in process wages and salaries payable Manubacturing overhead Acomulated depreciation $ 290,000 $120,000 $60,000 $180,000 $45000 $75000 $62000 Manubacaning overhead Accounts payable $ 62000 $300,000 work in process Manutachuring overhead - $300,000

Page No @ In above journal entries, o work in process - 290,000 X 80 %. - $232000 Manubacturing overhead = 290,000 X 20% = $58000 © Maribacturing overhead = ['80,000 x = $ 120,000 woork in process = 180,000 x = $60,000 O Manufacturing overhead = Predetermined overhead rate x machine hours = 95000 y $4800,000 240,000 = 15000 X $20 = $ 300,000 @ To accounts Manufacturing overhead Ending balance =-300,000 + 58000 +120,000 + 75000 + 62000 $15000

③ 0 © @ @ I Page No Manufacturing overhead Indirect materials $58000 $300,000 work in process inventory Indirect labox. $120,000 Accumulated deprecatione $ 25000 Accounts payable $ 60000 End balance $15000 NN woonte de process work in process © Direct materials $ 232000 © Dived labor $ 60,000 © Applied overhead $ 300,000 End balance $592000 ® Account title Record the enting to transfer to be in the finished goods Debit Credit Finished goods $592000 work in process $592000 => 23.2000 + 60,000 + 300,000 - $592000

Page.no @ 6 10,000 Cost of goods sold Coof of goods sofd = 592000 x .000 = 592000 x 0.625 = $370,000 Jo.cost of goods sold a $370,000