Question

Problem 3-44 Manufacturing Cost Flows; Analysis of T-Accounts (LO 3-2, 3-5)

Perfecto Pizza Company produces microwavable pizzas. The following accounts appeared in Perfecto’s ledger as of December 31.

Additional information:

a. Accounts payable is used only for direct-material purchases.

b. Underapplied overhead of $2,600 for the year has not yet been closed into cost of goods sold.

Required:

Complete the following T-accounts.

Raw-Material Inventory Accounts Payable Bal. 1/1 21,000 2,600 Bal. 1/1 136,500 Ba. 12/31 36,000 1,000 Bal. 12/31 Work-in-Process Inventory Finished-Goods Inventory Bal. 1/1 Direct material Direct labor Manufacturing overhead Bal. 12/31 17,000 Bal. 1/1 12,000 Bal. 12/31 20,000 19,000 Manufacturing Overhead Cost of Goods Sold 710,100 710,100 Wages Payable Sales Revenue 2,000 Bal. 1/1 147,000 5,000 Bal. 12/31 Accounts Receivable Bal. 1/1 11,200 806,000 Bal. 12/31 15,000

Answer 1

Raw materials Inventory Particulars Particulars Amount $21,000$ 1,21,500 Work In process $ 1,36,500 36,000 Bal. 12/31 Amount Bal1/1 Accounts payables 1,57,500 $ 1,57,500 Work In process Particulars Particulars Amount $17,000 $ 7,18,100 Finished Goods $ 1,21,500 $ 1,50,000 Amount Bal1/1 Direct material Direct Labour Manfacing Overhead 4,65,600 $36,000 Bal 12/31 $ 7,54,100 $ 7,54,100 Manufacturing Overhead Particulars Amount Amount Particulars Overhead $ 4,68,200 4,65,600 WIP 2,600 COGS $ 4,68,200 4,68,200 Wages Payables Amount Particulars Amount Particulars 2,000 Bal1/1 Cash Bal.31/12 $ 1,47,000 $1,50,000 Direct labour 5,000 1,52,000 1,52,000 Accounts receivable Particulars Particulars Amount S11,200 $ 8,09,800$ 8,06,000 Cash Amount Bal.1/1 Sales $15,000 Bal.12/31 8,21,000 $ 8,21,000 Note 1: Cost of Goods Sold- Opening Finished Goods +Cost of goods manufactured-Closing Finished Goods 710100-12000+COGM-20000 COGM -718100 Note 2: COGM-Opening WIP +DM used+DL +Manufacturing overhead -Closing WIP 7 18100-17000+121500+150000+МОН-36000 МОН-465600

Accounts payables Particulars Amount Amount Particulars $ 2,600 Bal.1/1 Direct Materials Purchased |$ Bal.12/31 1,36,500 $1,33,900 Cash 1,000 1,36,500 $1,36,500 Finished Goods Particulars Amount Amount Particulars Bal.1/1 WIP 12,000 7,18,100 $7,10,100 Cogs $ 20,000Bal.12/31 7,30,100$7,30,100 Cost of goods sold Particulars Amount Amount Particulars Finished Goods 7,10,100 Manufacturing Overhead $ 2,600 $7,12,700 Sales revenue 7,12,700 $7,12,700 Sales Revenue Particulars Amount Amount Particulars 7,12,700 $8,09,800 Accounts receivable Cogs Gross Profit 97,100 8,09,800 $ 8,09,800