Question

Entries and Schedules for Unfinished Jobs and Completed Jobs

Sinatra Industries Inc. uses a job order cost system. The following data summarize the operations related to production for January 2014, the first month of operations:

Materials purchased on account, $39,300.

Materials requisitioned and factory labor used:

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Factory overhead costs incurred on account, $7,500.

Depreciation of machinery and equipment, $2,640.

The factory overhead rate is $60 per machine hour. Machine hours used:

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Jobs completed: 201, 202, 203 and 205.

Jobs were shipped and customers were billed as follows: Job 201, $11,000; Job 202, $14,820; Job 203, $19,920.

Required:

1. Journalize the entries to record the summarized operations. For a compound transaction, if an amount box does not require an entry, leave it blank or enter "0".

2. Post the appropriate entries to T accounts for Work in Process and Finished Goods, using the identifying letters as transaction codes. Insert memo account balances as of the end of the month.

3. Prepare a schedule of unfinished jobs to support the balance in the work in process account.

4. Prepare a schedule of completed jobs on hand to support the balance in the finished goods account.

Answer 1

Solution-1

S.No.	Account Titles	Amount (Debit)	Amount (Credit)
a.	Materials	$39,300
	Accounts Payable		$39,300
b.	Work in Process	66,380
	Factory Overhead	6,940
	Materials		$36,020
	Wages Payable		37,300
c.	Factory Overhead	7,500
	Accounts Payable		7,500
d.	Factory Overhead	2,640
	Accumulated Depreciation-Machinery and Equipment		2,640
e.	Work in Process	17,280
	Factory Overhead		17,280
f.	Finished Goods	46,640
	Work in Process		46,640
g. (Sales)	Accounts Receivable	45,740
	Sales		45,740
(Cost)	Cost of Goods Sold	29,960
	Finished Goods		29,960

Solution-2

Work in Process
S.No.	Amount	S.No.	Amount
(b)	$66,380	(f)	$46,640
(e)	17,280
Balance	$37,020

Finished Goods
S.No.	Amount	S.No.	Amount
(f)	$46,640	(g)	$29,960
Balance	$16,680

Solution-3

Schedule of Unfinished Jobs
Job	Direct Materials	Direct Labor	Factory Overhead	Total
No. 204	$10,800	$9,150	$5,760	$25,710
No. 206	$5,000	$4,450	$1,860	$11,310
Balance of Work in Process, January 30				$37,020

Solution-4

Schedule of Completed Jobs
Job	Direct Materials	Direct Labor	Factory Overhead	Total
Finished Goods, January 30 (Job 205)	6,800	7,000	2,880	$16,680