Question

The Healthy Heart Company uses a normal job-order costing system in its only production department. Overhead is applied to jobs by a plant-wide overhead rate based on direct labor hours. The first year of operation began on December 1, 2018. During the month of December 2018, Healthy Heart purchased direct materials with a total cost of $4,000. Of the $4,000, Healthy Heart used $500 on Job 100. Job 100 was the only job worked during the month of December 2018. Healthy Heart also charged $1,200 in Direct Labor and $800 in Applied Overhead to Job 100 in December. JOB 100 WAS NOT FINISHED IN DECEMBER 2018, SO THE ENDING WIP INVENTORY FOR DECEMBER 31, 2018 WAS $2,500 ALL ON JOB 100. (Hint - remember to set up your Materials Inventory and calculate your ending materials inventory. For the new year (1/1/2019-12/31/2019), Healthy Heart had the following transactions. REMEMBER TO TAKE INTO CONSIDERATION THE ABOVE INFORMATION WHEN SETTING UP YOUR JOB SCHEDULE AS WE DID IN CLASS!! 1. Estimates for 2019 include $420,000 in Overhead and 30,000 in Direct Labor Hours. 2. Direct Materials purchased during 2019 cost a total of $84,000 3. Direct Materials used on the jobs during 2019 as follows: Jobs Direct Material Cost Job 100 $10,850 Job 101 $20,400 Job 102 $22,900 Job 103 $15,240 Job 104 $8,210 4. During 2019, Direct Labor HOURS incurred on each job are in the following table. The DIRECT LABOR RATE FOR THESE HOURS WAS $20.00 PER HOUR AND WOULD BE USED TO CALCULATE DIRECT LABOR COST. Jobs Direct Labor HOURS Job 100 4,845 Direct Labor Hours Job 101 6,900 Direct Labor Hours Job 102 9,750 Direct Labor Hours Job 103 5,850 Direct Labor Hours Job 104 2,916 Direct Labor Hours 5. By December 31, 2019: - All of Job 100 and 101 were completed. Job 100 consisted of 5,936 units and Job 101 consisted of 21,250 units 6. By December 31, 2019: -All of Job 101 was sold for $50.00 per unit. In addition, 5,000 of the 5,936 units of Job 100 were sold for $80 per unit. SUPER HINT! DON'T FORGET THAT YOU NEED APPLIED OH ON YOUR JOBS AS WELL AS DM & DL! HERE ARE YOUR QUESTIONS - BE SURE YOU PUT IN $ SIGNS and COMMAS AS NEEDED WITH EACH OF YOUR ANSWERS. FOR EXAMPLE, IF YOUR ANSWER IS 10000...YOU WOULD INSERT $10,000; 100000 WOULD BE $100,000 OR 1000 WOULD BE $1,000. IF THE ANSWER IS 0, YOU WOULD INSERT $0. YOU SHOULD ROUND TO THE NEAREST DOLLAR ("NO CENTS") IN YOUR ANSWER.

1.What is the Beginning Materials Inventory for 1/1/2019?

2.What is the Ending Materials Inventory for 12/31/2019?

3.What is the Beginning Work in Process Inventory for 1/1/2019?

4.What is the Ending Work in Process Inventory for 12/31/2019?

5.What is the Beginning Finished Goods Inventory for 1/1/2019?

6.What is the Ending Finished Goods Inventory for 12/31/2019?

7.What is the Cost of Goods Manufactured for the year ending 12/31/2019?

8.What is the UNADJUSTED Cost of Goods Sold for the year ending 12/31/2019? Careful - you are not required to compute under or overapplied OH (information was not given in the problem)

9.What was Sales Revenue for the year ending 12/31/2019?

Answer 1

The answer has been presented in the supporting sheet. For detailed answer refer to the supporting sheet.

1 4 Answer 2 Part 1) 3 Beginning material inventory = purchases in december 2018 - material used in december 2018 = 4000-500 5 = $ 3500 6 7 So the correct answer is $ 3500 8 9 Part 2) 10 Ending inventory 11 = beginning inventory + purchases - material used in 2019 12 = 3500 + 84000-(10850+20400+22900+15240+8210) 13 = $ 9900 14 15 So the correct answer is $ 9900 16 17 Part 3) 18 Beginning work in process 19 = Cost of Job 100 as on 31 december 2018 20 = $ 2500 21 22 So the correct answer is $ 2500

3 4 Part 4) 5 Ending work in proces 6 = Cost of job 102 + Cost of Job 103+ cost of Job 104 7 = (22900 + (9750*20)+(9750*14)) + (15240+(5850*20)+(5850*14)) + (8210+(2916*20)+(2916*14)) 8 = $ 675894 9 o So the correct answer is $ 675894 1 2 As per HomeworkLib policy we are required to solve the first 4 parts only. For remaining parts you have to post separate question 3 Thank You 4 5