Question

Check my work Exercise 15-5 Manufacturing cost flows LO P1, P2, P3 Custom Cabinetry has one job in process (Job 120) as of June 30, at that time, its job cost sheet reports direct materials of $6,100, direct labor of $4,300, and applied overhead of $3,655. Custom Cabinetry applies overhead at the rate of 85% of direct labor cost. During July, Job 120 is sold (on account) for $30,000, Job 121 is started and completed, and Job 122 is started and still in process at the end of the month. Custom Cabinetry incurs the following costs during July eBook Hint July Product Coats Direct materiale Direct labor Overhead applied Job 120 $1,700 3,300 Job 121 Job 122 $7,300 $3,100 4,900 2,400 Total $12, 100 10,600 References 1. Prepare journal entries for the following in July a. Direct materials used in production, b. Direct labor used in production, c. Overhead applied d. The sale of Job 120. e. Cost of goods sold for Job 120.

Answer 1

Particulars CR DR Work in process Direct material $12,100.00 $12,100.00 To assign direct material cost to work in process Work in process Direct labor $10,600.00 $10,600.00 To assign direct labor cost to work in process Work in process (10600*85%) $ 9,010.00 $ 9,010.00 Overhead To assign overhead cost to work in process Accounts receivable $30,000.00 $30,000.00 Sales revenue To record sale of job 120 on account Job 120 Cost of goods sold Particulars July $ 6,100.00 $ 1,700.00 $ 7,800.00 $ 4,300.00 $ 3,300.00 $ 7,600.00 Total June Direct material Direct labor Applied overhead (85% of direct la $ 3,655.00 Cost of goods sold $ 2,805.00 $ 6,460.00 $14,055.00 $ 7,805.00 $21,860.00