Question

E2-2 Stine Company uses a job order cost system. On May 1, the company has a balance Prepare in Work in Process Inventory of $3,500 and two jobs in process: Job No. 429 $2,000, and manugfa Job No. 430 $1,500. During May, a summary of source documents reveals the following. (LO 1, 2 Materials Labor Time Tickets Job Number 429 430 431 General use Requisition Slips $2,500 3,500 4,400 $1,900 3,000 7,600 $10,400 800 $11,200 $12,500 1,200 $13,700 Stine Company applies manufacturing overhead to jobs at an overhead rate o 60% of direct labor cost. Job No. 429 is completed during the month. Instructions (a) Prepare summary journal entries to record (1) the requisition slips, (2) the time tickets (3) the assignment of manufacturing overhead to jobs, and (4) the completion of Job No. 429. (b) Post the entries to Work in Process Inventory, and prove the agreement of the control account with the job cost sheets. (Use a T-account.)

Answer 1

	Beginning	Direct	direct	manufacturing	total
Job	WIP	materials	labor	total
429	2,000	2,500	1,900	1140	7540
430	1,500	3,500	3,000	1800	9800
431		4400	7600	4560	16560
total	3500	10400	12500	7500	33900
No	Date	Account titles and explanations				Debit	Credit
1	31-May	Work in process inventory				10,400
		factory overhead				800
		Raw materials inventory					11,200
2)	31-May	Work in process inventory				12,500
		factory overhead				1,200
		Factory wages payable					13,700
3)	31-May	Work in process inventry				7,500
		factory overhead					7,500
4)	31-May	finished goods				7,540
		Work in process inventory					7,540
		Work in process ivnentory
	BB	3,500
	1)	10,400	4)	7,540
	2)	12,500
	3)	7,500
	end bal	26,360
		Job cost sheets
		Beginning	Direct	direct	manufacturing	total
	Job	WIP	materials	labor	total
	430	1,500	3,500	3,000	1800	9800
	431		4400	7600	4560	16560
	total	1500	7900	10600	6360	26360