Question

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, 2020, the general ledger for Case Inc. contains the following data.

Raw Materials Inventory		$4,600		Manufacturing Overhead Applied		$35,000
Work in Process Inventory		$5,425		Manufacturing Overhead Incurred		$29,800

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		$700		$900		$900
Direct labor		300		500		500
Manufacturing overhead		375		625		625
		$1,375		$2,025		$2,025

During June, raw materials purchased on account were $5,000, and all wages were paid. Additional overhead costs consisted of depreciation on equipment $900 and miscellaneous costs of $500 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		$700		$800
Koss		1,900		900
Stevens		600		400
Linton		1,400		1,400
Rodgers		400		500
		5,000		4,000
General use		1,500		1,100
		$6,500		$5,100

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 $20,200. Each customer paid in full.

Answer 1

Journalize the transaction as follows:

Trn.	Account titles	Debit	Credit
1	Raw Material inventory	$5,000
	Accounts payable		$5,000
	Factory labor	$5,100
	Cash		$5,100
	Manufacturing overhead	$1,400
	Accumulated Depreciation-Equipment		$900
	Accounts payable		$500
2	Work in process inventory	$5,000
	Manufacturing overhead	$1,500
	factory labor		$6,500
	Work in process inventory	$4,000
	Manufacturing overhead	$1,100
	Factory Labor		$5,100
	Work in process inventory ($4,000 × 1.25)	$5,000
	Manufacturing overhead		$5,000
3	Finished Goods Inventory	$15,550
	Work in process inventory		$15,550

______________________________________________________

Cost of goods manufactured schedule
WIP, June 1		$5,425
Direct material used	$5,000
Direct labor	$4,000
Manufacturing applied	$5,000
Total manufacturing cost		$14,000
Total cost of WIP		$19,425
Less: WIP, June 30		($3,875)
Koss ($1900+$900+$1075)
Cost of goods manufactured		$15,550