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Problem 19-3A Source documents, journal entries, and accounts in job order costing LO P1, P2, P3

[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.

1. Purchased raw materials on credit, $240,000.
2. Materials requisitions record use of the following materials for the month.

Job 136	$50,000
Job 137	32,500
Job 138	19,200
Job 139	23,000
Job 140	6,600
Total direct materials	131,300
Indirect materials	20,500
Total materials used	$151,800

3. Paid $15,500 cash to a computer consultant to reprogram factory equipment.
4. Time tickets record use of the following labor for the month. These wages were paid in cash.

Job 136	$12,000
Job 137	10,600
Job 138	37,700
Job 139	39,600
Job 140	3,400
Total direct labor	103,300
Indirect labor	25,000
Total	$128,300

5. Applied overhead to Jobs 136, 138, and 139.
6. Transferred Jobs 136, 138, and 139 to Finished Goods.
7. Sold Jobs 136 and 138 on credit at a total price of $525,000.
8. The company incurred the following overhead costs during the month (credit Prepaid Insurance for expired factory insurance).

Depreciation of factory building	$69,500
Depreciation of factory equipment	37,500
Expired factory insurance	11,000
Accrued property taxes payable	35,500

9. 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.

Problem 19-3A Part 1

1. Prepare a job cost sheet for each job worked on during the month.

Problem 19-3A Part 2

2. Prepare journal entries to record the events and transactions a through i.

Problem 19-3A Part 3

3. Post the journal entries for the transactions to the following T-accounts, each of which started the month with a zero balance.

Problem 19-3A Part 4

4. Prepare a report showing the total cost of each job in process and prove that the sum of their costs equals the Work in Process Inventory account balance. Prepare similar reports for Finished Goods Inventory and Cost of Goods Sold.

Job No. 136 Job No. 137 Job No. 138 Job No. 139 Job No.140 Materials Labor Overhead Total cost 0 Raw Materials Inventory Work in Process Inventory End.bal. End.bal. Factory Overhead Finished Goods Inventory End.bal End.bal. Cost of Goods Sold End.bal Report of Job Costs Work in Process Inventory Balance Finished Goods Inventory Balance Cost of Goods Sold Balance

Answer 1

		job 136	job 137	job138	job139	job140	total
Materials		50,000	32,500	19,200	23,000	6,600	131,300
labor		12,000	10,600	37,700	39,600	3,400	103,300
overhead		24,000	21200	75400	79200	6800	206,600
total		86,000	64,300	132,300	141,800	16,800	441,200
2)	TR	General Journal				Debit	Credit
	a)	Raw materials inventory				240,000
		Accounts payable					240,000
	b)	Work in process inventory				131,300
		Factory overhead				20,500
		Raw materials inventoy					151,800
	c)	Factory overhead				15,500
		cash					15,500
	d)	Work in process inventory				103,300
		Factory overhead				25,000
		Cash					128,300
	e)	Work in process overhead				178,600
		Factory overhead					178,600
	f)	finished goods inventory				360,100
		Work in process inventory					360,100
	g)	Accounts receivable				525,000
		Sales					525,000
		cost of goods sold				218,300
		finished goods inventory					218,300
	h)	Factory overhead				153,500
		Accumulated depreciation-factory building					69,500
		Accumulated depreciation-factory equipment					37,500
		prepaid insurance					11,000
		property taxes payable					35,500
	i)	work in process inventory				28,000
		Factory overhead					28,000
	T- Accounts
Raw materials inventory					Work in process inventory
a.	240,000				b.	131,300
		151,800	b.		d.	103,300
					e.	178,600
end bal	88,200						360,100	f.
					i.	28000
					bal	81,100
Factory overhead					finished goods inventory
b.	20,500				f.	360,100
c.	15,500						218,300	g.
d.	25,000				bal	141,800
		178,600	e.
h.	153,500
		28,000	i
bal	7,900
cost of goods sold
g.	218,300
end bal	218,300
Report of Job costs
Work in process inventory
job 137			64,300
job 140			16,800
Balance			81,100
finished goods inventory
job 139			141,800
Balance			141,800
cost of goods sold
job 136			86,000
job 138			132,300
balance			218,300