Question

- Ch 3) Saved [The following information applies to the questions displayed below) Widmer Watercraft's predetermined overhead rate for the year 2017 is 200% of direct labor. Information on the company's production activities during May 2017 follows a. Purchased raw materials on credit. $220,000 b. Materials requisitions record use of the following materials for the month. Job 136 Job 137 Job 138 Job 139 Job 140 Total direct materials Indirect materials Total materials used $ 48,500 32,000 20,200 22,400 6,600 129,700 20,500 $150,200 c. Paid $15,250 cash to a computer consultant to reprogram factory equipment. d. Time tickets record use of the following labor for the month. These wages were paid in cash. Job 136 Job 137 Job 138 Job 139 Job 140 Total direct labor Indirect labor Total $ 12,280 10,800 37,700 39,000 3,800 102,700 26,500 $129,200 e. Applied overhead to Jobs 136, 138, and 139. f. Transferred Jobs 136, 138, and 139 to Finished Goods. 9. Sold Jobs 136 and 138 on credit at a total price of $530,000 h. The company incurred the following overhead costs during the month (credit Prepaid Insurance for expired factory insurance) Depreciation of factory $68,000 building Depreciation of factory 37,500 equipment Expired factory insurance 11,000 Accrued property taxes 37,000 payable 1. Applied overhead at month-end to the Work in Process Inventory account Jobs 137 and 140) using the predetermined overhead rate of 200% of direct labor cost. 3. Post the journal entries for the transactions to the following T-accounts, each of which started the month with a zero Balance

Answer 1

3. Ledger a. Raw Materials Inventory $ 220,000 $ 150,200 $ 69,800 4. Report of Job Costs Report of Job Costs Work in Process Inventory Job 137 $ Job 140 $ b. 64,400 15,600 End.Bal. $ 80,000 b. Balance Finished Goods Inventory Job 139 d. $ 138,500 e. Work In Process Inventory $ 129,700 $ 102,700 $ 177,800 $ 357,800 $ 27,600 $ 80,000 f. $ 138,500 i. End.Bal. Balance Cost of goods Sold Job 136 Job 138 $ $ 85,100 133,300 b. Balance $ 218,400 C. d. $ $ $ Factory Overhead 20,500 15,250 26,500 $ 177,800 153,500 $ 27,600 10,350 e. h. $ i. End.Bal. $ f. Finished Goods Inventory $ 357,800 $ 219,300 $ 138,500 g End.Bal. Cost of Goods Sold 218,400 g $ End.Bal. $ 218,400

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Workings:

Required: 1 Prepare a job cost sheet for each job worked on during the month. Materials Labor Overhead (200% of labor) Total cost Job No. 136 Job No. 137 Job No. 138 Job No. 139 Job No. 140 $ 48,500 $ 32,000 $ 20,200 $ 22,400 $ 6.600 $ 12,200 $ 10,800 $ 37,7000 $ 39,000 $ 3,000 $ 24,4000 $ 21,600 $ 75,400 $ 78,000 $ 6,000 $ 85,100 $ 64,400 $ 133,300 $ 139,400 $ 15,600 Credit 2 Prepare journal entries Transaction General Journal Debit Raw materials inventory $ 220,000 Accounts payable a. $ 220,000 b. Work in process inventory Factory overhead Raw materials inventory $ $ 129,700 20,500 $ 150,200 $ 15,250 Factory overhead Cash $ 15,250

d. Work in process inventory Factory overhead Factory payroll $ $ 102,700 26,500 $ 129,200 e. $ 177,8001 Work in process inventory Factory overhead $ 177,800 f. $ 357,800 Finished goods inventory Work in process inventory $ 357,800 $ Accounts receivable Sales 530,000 $ 530,000 g2. $ 218,400 Cost of goods sold Finished goods inventory $ 219,300 h. $ 153,500 Factory overhead Accum. depreciation-Factory building Accum. depreciation-Factory equipment Prepaid insurance Property taxes payable $ $ $ $ 68,000 37,500 11,000 37,000 i. $ 27,600 Work in process inventory Factory overhead $ 27,600 f. To apply overhead to jobs: [($12.200+ $37,700+ $39.000) * 200%) = $177,800 To record completion of jobs: ($85,100+ $133,300 + $139,400) = $357,800 To record cost of sales: ($85,100+ $133,300) = $218,400 To apply overhead to jobs: [($21,600+$6,000) = $27,600 h. j.

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