Question

For the year ended December 31, 2020, the job cost sheets of Cinta Company contained the following data.

Job Number		Explanation		Direct Materials		Direct Labor		Manufacturing Overhead		Total Costs
7640		Balance 1/1		$27,000		$25,920		$31,104		$84,024
		Current year’s costs		32,400		38,880		46,656		117,936
7641		Balance 1/1		11,880		19,440		23,328		54,648
		Current year’s costs		46,440		51,840		62,208		160,488
7642		Current year’s costs		62,640		59,400		71,280		193,320

Other data:

1.		Raw materials inventory totaled $16,200 on January 1. During the year, $151,200 of raw materials were purchased on account.
2.		Finished goods on January 1 consisted of Job No. 7638 for $93,960 and Job No. 7639 for $99,360.
3.		Job No. 7640 and Job No. 7641 were completed during the year.
4.		Job Nos. 7638, 7639, and 7641 were sold on account for $572,400.
5.		Manufacturing overhead incurred on account totaled $129,600.
6.		Other manufacturing overhead consisted of indirect materials $15,120, indirect labor $19,440, and depreciation on factory machinery $8,640.

Prove the agreement of Work in Process Inventory with job cost sheets pertaining to unfinished work. Post each to the T-account in the following order: (1) beginning balance, (2) direct materials, (3) direct labor, (4) manufacturing overhead, and (5) completed jobs.

Answer 1

		Job cost sheet
			job 7640	job7641	job 7642
Balance 1/1
Direct materials			27,000	11,880		38,880
Direct labor			25,920	19,440		45,360
Manufacturing overhead			31,104	23,328		54,432
total beginning balance 1/1			84,024	54,648		138,672
Cost added during the year
Direct materials			32,400	46,440	62,640	141,480
Direct labor			38,880	51,840	59,400	150,120
Manufacturing overhead			46,656	62,208	71,280	180,144
Total cost added during the yr			117,936	160,488	193,320	471,744
total cost of jobs			201,960	215,136	193,320	610,416
only job 7642 is uncompleted , its balance is 193,320
completed work (job 7640+7641) that is 201960+215136=						417,096
balance in finished goods inventory will equal job 7640
		Work in process inventory
1-Jan	Balance		138,672	Completed work		417,096
	Direct materials		141,480
	Direct labor		150,120
	Manufacturing overhead		180,144
31-Dec	Balance		193,320
Work in process balance			193,320
unfinished jobs		no 7642	193,320
Account titles and explanations				Debit	Credit
Manufacturing overhead				7,344
Cost of good ssold					7,344
(180144 applied - 129,600 incurred-15,120 Ind mat-19,440 ind Lab-8,640 dep)
Gross profit
Sales					572,400
less cost of goods sold					401,112
Gross profit					171,288
finished goods
beg bal	193,320
WIP	417,096	COGS	408,456
end bal	201,960
adjusted cost of goods sold = 408456-7344
			401,112