Question

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 folows. 4 a. Purchased raw materials on credit, $220.000. b. Materials requisitions record use of the following materials for the month. Part 1 of 4 $ 49,500 32,500 19,600 22,400 6,800 130, 800 19,500 Job 136 Job 137 Job 138 points Job 139 Job 140 Total direct naterials Indirect materials $150,300 Total materials used c. Paid $15,000 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. S 12,100 10,700 37,700 39.600 3,200 Job 136 Job 137 Job 138 Job 139 Job 140 Total direet labor 103,300 24.000 Indirect labor $127,300 Total

Answer 1

Solution 1:

	Job No. 136	Job No. 137	Job No. 138	Job No. 139	Job No. 140
Materials	$49,500.00	$32,500.00	$19,600.00	$22,400.00	$6,800.00
Labor	$12,100.00	$10,700.00	$37,700.00	$39,600.00	$3,200.00
Overhead	$24,200.00	$21,400.00	$75,400.00	$79,200.00	$6,400.00
Total cost	$85,800.00	$64,600.00	$132,700.00	$141,200.00	$16,400.00

Solution 2:

Journal Entries - Widmer Watercraft
Event	Particulars	Debit	Credit
a	Raw material inventory Dr	$220,000.00
	To Accounts Payable		$220,000.00
	(To record purchase of raw material)
b	Work In Process Dr	$130,800.00
	Factory overhead Dr	$19,500.00
	To Raw material inventory		$150,300.00
	(To record raw material used in production)
c	Factory overhead Dr	$15,000.00
	To Cash		$15,000.00
	(Cash paid to consultant for reporgram factory equipment)
d	Work In Process Dr	$103,300.00
	Factory overhead Dr	$24,000.00
	To Cash		$127,300.00
	(To record direct and indirect labor payment and assigment to production)
e	Work In Process Dr	$178,800.00
	To Factory Overhead		$178,800.00
	(To apply overhead to Job 136, 138, 139)
f	Finished goods inventory Dr	$359,700.00
	To Work In Process		$359,700.00
	(Being completed jobs transferred to finished goods)
g1	Accounts receivables Dr	$535,000.00
	To Sales Revenue		$535,000.00
	(To record sales of Job 136 and 138)
g2	Cost of goods sold Dr	$218,500.00
	To Finished goods inventory		$218,500.00
	(To record cost of goods sold for Job 136 and 138)
h	Factory overhead Dr	$155,000.00
	To Accumulated depreciation - Factory Building		$68,500.00
	To Accumulated depreciation - Factory Equipment		$38,000.00
	To Prepaid insurance		$12,000.00
	To Property taxes payable		$36,500.00
	(To record overhead incurred)
i	Work In Process Dr	$27,800.00
	To Factory Overhead		$27,800.00
	(To apply overhead to Job 137 and 140)

Solution 3:

Raw material Inventory
Event	Debit	Event	Credit
a	$220,000.00	b	$150,300.00
		Ending Balance	$69,700.00
Total	$220,000.00	Total	$220,000.00
Work In Process Inventory
Event	Debit	Event	Credit
b	$130,800.00	f	$359,700.00
d	$103,300.00	Ending Balance	$81,000.00
e	$178,800.00
i	$27,800.00
Total	$440,700.00	Total	$440,700.00
Finished Goods Inventory
Event	Debit	Event	Credit
f	$359,700.00	g	$218,500.00
		Ending Balance	$141,200.00
Total	$359,700.00	Total	$359,700.00
Cost of goods sold
Event	Debit	Event	Credit
g	$218,500.00	Ending balance	$218,500.00
Total	$218,500.00	Total	$218,500.00
Manufacturing Overhead
Event	Debit	Event	Credit
b	$19,500.00	e	$178,800.00
c	$15,000.00	i	$27,800.00
d	$24,000.00	Underapplied overhead	$6,900.00
h	$155,000.00
Total	$213,500.00	Total	$213,500.00

Solution 4:

Report of Job Cost Sheet - Widmer Watercraft
Particulars	Amount
Work In Process Inventory:
Job 137	$64,600.00
Job 140	$16,400.00
Balance	$81,000.00
Finished Goods Inventory:
Job 139	$141,200.00
Balance	$141,200.00
Cost of goods sold:
Job 136	$85,800.00
Job 138	$132,700.00
Balance	$218,500.00