Question

The Toy Compay uses a job-costing system at its Chicago plant. The plant has a machining department and a finishing department. Toy uses normal costing with two direct-cost categories (direct materials and direct manufacturijng labor) and two manufacturing overhead cost pools (the machining department with direct material costs as the alloation base and finishing department with direct costs as the allocation base.) The 2020 budget for the plant is as follows: Cell referencing answers is required. Machining department Finisghing department Manufacturing overhead cost 9,000,000 4,000,000 Direct materal 140,000 4,000,000 Direct manufacturing labor cost 970,000 4,000,000 Direct manufacturing labor-hour 26,000 160,000 Machin hours 205,000 31.000 What is the budgeted manufacturing overhead rate in the respective depatments Machining department Finisghing department During the month of February, the job-cost record for Job 500 shows the following: Machining department Direct materials used 21,150 Direct labor used 350 Direct labor hours 30 Machine hours 150 Finisghing department 5,000 1,300 50 20 Units produced 500 Prepare the respective journal entries to match cost flows to product flows

Answer 1

Answer is given below with working

Budgeted manufacturing overhead rate Machining Finishing Department Department Budgeted overhead rate 6428.57% 50.00% Working notes: Manufacturing overheads Direct material Direct cost Absorption rate Machining Finishing Department Department $9,000,000 $4,000,000 $140,000 $8,000,000 6428.57% 50.00% Direct material Machining Department General Journal WIP Job No. 500-MFO Raw Materials Inventory Credit Debit $21,150 $21,150 Credit Finishing Department General Journal WIP Job No. 500-MFO Raw Materials Inventory Debit $5,000 $5,000 Direct Labor Machining Department General Journal WIP Job No. 500-MFO Wages payable Credit Debit $350 $350 Credit Finishing Department General Journal WIP Job No. 500-MFO Wages payable Debit $1,300 $1,300 Manufacturing Machining Department WIP Job No. 500-MFO Manufacturing overhead applied Debit $1,359,643 Credit 6428.57% of direct material cost $1,359,643 Debit Finishing Department WIP Job No. 500-MFO Manufacturing overhead applied $3,150 Credit 50% of Direct cost =$6,300 $3,150 Total product cost $1,390,593 Total cost $21,150 $5,000 $26,150 Direct Material Machining Department Finishing Department Direct labor Machining Department Finishing Department Overheads applied Machining Department Machining Department Total product cost $350 $1,300 $1,650 $1,359,643 $3,150 $1,362,793 $1,390,593 Cost per unit $2,781.19 Total cost/500 units