Question

During March, Aragon Company worked on three jobs. Data relating to these three jobs follow: Job 78 Job 79 Job 80 230 210 210 210 Units in each order Units sold Materials requisitioned Direct labor hours $1,029 $2.289 $1,656 253 231 378 Direct labor cost $ 2,783 $3,234 $3,478 Overhead is assigned on the basis of direct labor hours at a rate of $7.30 per direct labor hour. During March, Jobs 78 and 79 were completed and transferred to Finished Goods Inventory. Job 79 was sold by the end of the month. Job 80 was the only unfinished job at the end of the month. Required: 1. Calculate the per-unit cost of Jobs 78 and 79. Round your answers to the nearest cent. Job 78 $ per unit Job 79 $ per unit 2. Compute the ending balance in the work-in-process inventory account. Round your answer to the nearest cent. $ 3. Prepare the journal entries reflecting the completion of Jobs 78 and 79 and the sale of Job 79. The selling price is 130 percent of cost. Round your answers to the nearest cent. Completion of Jobs 78 & 79 Sale of Job 79 (cost) Sale of Job 79 (sale)

Answer 1

Answer 1.

Job 78	$27.33	per unit
Job 79	$28.33	per unit

Explanation:

	Job 78	Job 79
Materials requisitioned	1,656	2,289
Direct labor	2,783	3,478
Overhead	($7.30 * 253) = 1,846.90	($7.30 * 231) = 1,686.30
Total cost	$6,285.90	$5,949.30
Divide by number of units	230 units	210 units
Per unit cost	$27.33	$28.33

Answer 2

Ending balance in the work-in-process inventory account: $8,526.40

Explanation:

	Job 80
Materials requisitioned	2,289
Direct labor	3,478
Overhead	($7.30 * 378) = 2,759.40
Ending balance in the work-in-process inventory account	$8,526.40

Answer 3.

	Accounts	Debit	Credit
Completion of Jobs 78 and 79 and the sale of Job 79.	Finished Goods (6,285.90 + 5,949.30)	12,235.20
	Work in Process		12,235.20
Sale of Job 79 (cost)	Cost of Goods Sold	5,949.30
	Finished Goods		5,949.30
Sale of Job 79 (sale)	Accounts Receivable (5,949.30 * 130%)	7,734.09
	Sales Revenue		7,734.09

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