Question

Marcelino Co.'s March 31 inventory of raw materials is $90,000 Raw materials purchases in April are $520,000, and factory payroll cost in April is $375,000 Overhead costs incurred in April are indirect materials, $56,000 indirect labor, $22,000, factory rent, $34,000, factory utilities, $22,000, and factory equipment depreciation, $56,000. The predetermined overhead rate is 50% of direct labor cost. Job 306 is sold for $635,000 cash in April. Costs of the three jobs worked on in April follow. Job 306 Job 3e7 Job 308 $ 28,000 24,000 12,000 $ 38,000 18,000 9,000 Balances on March 31 Direct materials Direct labor Applied overhead Costs during April Direct materials Direct labor Applied overhead Status on April 30 132,000 101,000 210,000 151,000 $110,000 101,000 2 Finished (sold) Finished (unsold) In process a. Materials purchases (on credit). b. Direct materials used in production. c. Direct labor paid and assigned to Work in Process Inventory. d. Indirect labor paid and assigned to Factory Overhead. e. Overhead costs applied to Work in Process Inventory. f. Actual overhead costs incurred, including indirect materials (Factory rent and utilities are paid in cash) g. Transfer of Jobs 306 and 307 to Finished Goods Inventory h. Cost of goods sold for Job 306.

Answer 1

1)			Job 306	Job 307	Job 308	April
From March
Direct materials			28,000	38,000	0	66,000
Direct labor			24,000	18,000	0	42,000
applied overhead			12,000	9,000	0	21,000
Beginning goods in process			64,000	65,000	0	129,000
For April
Direct materials			132,000	210,000	110,000	452,000
Direct labor			101,000	151,000	101,000	353,000
applied overhead			50500	75500	50500	176,500
Total costs added in April			283,500	436,500	261,500	981,500
total costs (April 30)			347,500	501,500	261,500	1,110,500
Satus on april 30			fin(sold)	fin(unsold)	in process
April costs included in :			COGS	finished	WIP
				goods
				inventory
2)	TR	General journal				Debit	Credit
	a.	Raw materials inventory				520,000
		Accounts payable					520,000
	b.	Work in process inventory				452,000
		Raw materials inventory					452,000
	c.	Work in process inventory				353,000
		Cash					353,000
	d.	Factory overhead				22,000
		cash					22,000
	e.	Work in process inventory				176,500
		Factory overhead					176,500
	f.	Factory overhead				168,000
		Raw materials inventory					56,000
		Cash					56,000
		Accumulated Depreciation					56,000
	g.	finished goods inventory				849,000
		Work in process inventory					849,000
	h.	Cost of goods sold				347,500
		finished goods inventory					347,500
	i.	Cash				635,000
		sales					635,000
	j.	cost of goods sold				13,500
		Factory overhead					13,500
3)		Schedule of goods of goods manufactured
		direct materials used					452,000
		Direct labor used					353,000
		factory overhead applied					176,500
		total manufacturing costs					981,500
		Add:work in process March 31					129,000
		total cost of work in process					1,110,500
		less:work in process April 30					261,500
		cost of goods manufactured					849,000
4)		Gross profit
		sales				635,000
		less cost of goods sold				361,000
		Gross profit				274,000
5)		inventories
		Raw materials				102,000
		work in process				261,500
		finished goods				501,500
		total inventories				865,000