Question

Step 1 You work for Thunderduck Custom Tables Inc. This is the first month of operations. The company designs and manufactures specialty tables. Each table is specially customized for the customer. This month, you have been asked to develop and manufacture two new tables for customers. You will design and build the tables. This is a no nail, no screw, and no glue manufacturing (no indirect materials used). You will be keeping track of the costs incurred to manufacture the tables using Job #1 Cost Sheet and Job 2 Cost Sheet The cost of the direct materials that can be used to manufacture the table are as follows. These cost are on a per unit basis. Table Top $2,700.00 Table Leg $1,000.00 Drawer $470.00 The company uses a job order costing system and applies manufacturing overhead to jobs based on direct labor hours. The company estimates that there will be 12 direct labor hours worked during the month The estimated manufacturing overhead cost for the month is: a. Factory supervisor salary per month Rent for the factory per month c. Depreciation of factory equipment per month Total Estimated manufacturing overhead b. $3,500.00 $1,300.00 $600.00 $5,400.00 450 What is the predetermined manufacturing overhead rate? The first order you received was to manufacture a table using a table top and four legs. This is your job 81. The customer that has ordered job #2, wants a table that is the same as job 81, but wants to also add a drawer to the table. Step 2 Step 3 Step 4 The following is a list of transactions that need to be recorded for the company for activity in the month of December. Record those in the "General Journal" tab of the excel file using the proper format. Please use the following accounts: Accounts Receivables, Raw materials, Work in process, Finished goods, Accumulated depreciation Accounts payable, Salaries and wages payable, Sales revenue, Manufacturing overhead, Cost of goods sold, Salaries and wages expense, Advertising expenses, and Depreciation expense. 1-Dec 5-Dec Raw Materials purchased on account, $27,000 All Raw Materials needed for Job #1 were requisitioned from the material storage for use during the month. Assume all materials are direct. (After you journalize this entry please enter the information into Job #1 Cost Sheet) The following employee costs were incurred but not paid during the month: 10-Dec

Answer 1

Please hit LIKE button if this helped. For any further explanation, please put your query in comment, will get back Table Top Predetermined Overhead Rate $5,400/12 Hours $ 450 Estimated Overhead/Allocation Base Date Account Debit Credit $ 27,000 Dec 1 Dec 1 Raw Material Accounts Payable (Purchase of Raw Material) $ 27,000 $ 6,700 Dec 5 Dec 5 Work in Process Inventory $2,700+($1,000*4) Raw Material Inventory (Requisition of direct and indirect mat) $ 6,700 Actual Dec 10 Dec 10 Dec 10 Dec 10 Work in Process Inventory (3*2*$25) Manufacturing Overhead Salaries and Wages Expense Salaries and Wages Payable (being labor cost recorded - direct and indirect) $ $ $ 150 4,000 2,000 Actual $ 6,150 Dec 15 $ 7,170 Work in Process Inventory $2,700+($1,000*4)+$470 Raw Material Inventory (Requisition of direct and indirect mat) $ 7,170 Dec 16 $ 1,300 Manufacturing Overhead Accounts Payable $ 1,300 Dec 17 $ 1,600 Advertising Expense Accounts Payable $ 1,600 Dec 20 Dec 20 Dec 20 $ $ 150 600 Actual Manufacturing Overhead Depreciation Expense Accumulated Depreciation (being ACTUAL overhead recorded) $ 750 $ 2,700 Dec 22 Dec 22 $ 2,700 Work in Process Inventory $450*6 Manufacturing Overhead (Overhead applied) (Predetermined Overhead Rate*Allocation Base) Applied $ 9,550 Dec 26 Dec 26 Finished Goods Inventory Work in Process Inventory $ 9,550 Cost of Goods Manufactured

$ 32,000 Dec 28 Dec 28 Accounts Receivable Sale $ 32,000 $ 9,550 Dec 28 Dec 28 Cost of goods sold Finished Goods Inventory $ 9,550 Cost of Goods Sold $ 75 Dec 31 Dec 31 Work in Process Inventory (3*1*$25) Salaries and Wages Payable (To record labor cost recorded - direct and indirect) $ 75 $ 1,350 Dec 31 Dec 31 $ 1,350 Work in Process Inventory $450*3 Manufacturing Overhead (Overhead applied) (Predetermined Overhead Rate*Allocation Base) Applied $ 1,400 Dec 31 Dec 31 Cost of Goods Sold Manufacturing Overhead (To record underapplied overheads) $ 1,400 What is the ending balance for raw materials? $ 13,130 a What is the ending balance for work in process? $ 8,595 b What is the ending balance for finished goods? $ с What is the actual manufacturing overhead cost incurred d $ 5,450 d What is the total applied manufacturing overhead cost du $ 4,050 e What is the unadjusted cost of goods sold? $ 9,550f Was the manufacturing overhead for the month of Sepem Under Applied 8 What is the amount of Manufacturing overhead overappli $ 1,400 h What is the adjusted cost of goods sold? $ 10,950 i=f+h What is gross margin? $ 21,050 What is the total prime cost for Job#1? $ 6,850 k=$6,700+$150 What is the total conversion cost for job #1? $ 2,850 1=$150+$2,700 What is the total product cost for job#1? $ 9,550 m=$6,700+$150+$2,700 What was the period cost incurred for the month of Seper $ 4,200 n What is the total variable cost incurred for Job #1 $ 6,850 O $6,700+$150 What is the contribution margin for Job #1 $ 25,150 p=Sale-O What would be the actual (not applied) total fixed manufd $ 5,450 Break up: Salary of Supervisor $ 4,000 Rent of Factory Building $ 1,300 Depreciation of Equipment $ 150 From RM T-Account From WIP T account From Finished Goods T Account From Manufacturing Overhead T Account From Manufacturing Overhead T Account Cost of Goods Sold T Account Since Applied overheads are less than actual Actual-Applied Unadjusted COGS+ovh adjusted Sale-Adjusted COGS RM+Labor Labor+Overheads RM+Labor+Overheads Salary+Dep+Advertising RM+Labor Sale-Variable Cost Since it is fixed for the month, it will remain

Predetermined Overhead Rate Estimated Overhead/Allocation Base Raw Material Debit Credit $ 27,000 Dec 5 $ Dec 15 $ Dec 1 Job Cost Sheet for Job No 1 6,700 7,170 Direct Material Direct Labor Rate Manufaturing Overhead Amount Hours Rate Amount Hours $ 6,700 Ending $ 13,130 6 $ 450 $ 2,700 Date 12/5 Date 12/10 Date 12/22 Cost Summary Direct Material Direct Labor Manufacturing Overhead Total Product Cost Unit Product Cost 25 $ 150 6 $ Units Shipped No Balance Date Work in Process Debit Credit Dec 5 $ 6,700 Dec 26 $ Dec 10 $ 150 Dec 15 $ 7,170 Dec 22 $ 2,700 Dec 31 $ 75 Dec 31 $ 1,350 Ending $ 8,595 9,550 $ $ $ $ $ 6,700 150 2,700 9,550 9,550 Job Cost Sheet for Job No 2 Direct Material Finished Goods Debit Credit Dec 26 $ 9,550 Dec 28 $ 9,550 Direct Labor Rate Manufaturing Overhead Amount Hours Rate Amount Hours $ 7,170 3 $ 25 $ 75 3 $ 450 $ 1,350 Date 12/15 Date 12/31 Date 12/31 Cost Summary Direct Material Direct Labor Manufacturing Overhead Total Product Cost Unit Product Cost Units Shipped No Date Balance Ending $ $ $ $ $ 7,170 75 1,350 8,595 8,595 Manufacturing Overhead Debit Credit Dec 10 $ 4,000 Dec 22 $ 2,700 Dec 16 $ 1,300 Dec 31 $ 1,350 Dec 20 $ 150 Dec 31 $ 1,400 Cost of Goods Sold Debit Credit $ 9,550 $ 1,400 Dec 28 Dec 31

Cost of Goods Manufactured: $ $ $ $ $ $ $ Finished goods inventory, beginning Work in process inventory, beginning Direct materials: Direct materials inventory, beginning Direct materials purchases Cost of direct materials available for use Direct materials inventory, ending Cost of direct materials placed in production Direct labor Factory overhead Applied Total manufacturing costs Total work in process during period Work in process inventory, ending Cost of goods manufactured Cost of finished goods available for sale Finished goods inventory, ending Cost of goods sold-Unadjusted Underapplied/(overapplied overhead) Cost of goods sold-Adjusted 27,000 27,000 -13,130 13,870 225 4,050 S $ $ S 18,145 18,145 -8,595 $ $ 9,550 $ 9,550 $ $ 9,550 1,400 $ 10,950 $ 32,000 Incme Statement: Sales Revenue Less: Cost of Goods Sold: COGS $ 10,950 $ 10,950 $ 21,050 Gross Margin Less: Selling and Admin: Salary Dep Advertising $ $ $ 2,000 600 1,600 $ $ 4,200 16,850