Question

Kurtz Fencing Inc. uses a job order cost system. The following data summarize the operations related to production for March, the first month of operations:

Kurtz Fencing Inc. uses a job order cost system. The following data summarize the operations related to production for March, the first month of operations: a. Materials purchased on account, $45,000. b. Materials requisitioned and factory labor used: Job Materials Factory Labor $2,500 301 $ 1,850 302 3,150 7,220 303 2,200 5,350 304 1,800 2,400 305 4,230 6,225 306 1,770 2,900 For general factory use 1,200 5,000 c. Factory overhead costs incurred on account, $1,800. d. Depreciation of machinery and equipment, $2,500. e. The factory overhead rate is $30 per machine hour. Machine hours used: Job Machine Hours 301 302 306 Total 300

1. Journalize the entries to record the summarized operations. Record each item (items a-f) as an individual entry on March 31. Record item g as 2 entries. Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for spaces or journal explanations. Every line on a journal page is used for debit or credit entries. Do not add explanations or skip a line between journal entries. CNOW journals will automatically indent a credit entry when a credit amount is entered.

Answer 1

			Factory	overhead	total
		Materials	labor	applied
	Job 301	1,850	2,500	900	5,250
	job 302	3,150	7,220	1800	12,170
	job 303	2,200	5,350	1230	8,780
	job 304	1,800	2,400	1890	6,090
	job 305	4,230	6,225	2100	12,555
	job 306	1,770	2,900	1080	5,750
	total	15,000	26,595	9000	50,595
1)	Journal Entries
	Accounting titles & Explanations				Debit	Credit
a)	Raw materials inventory				45,000
	Accounts payable					45,000
b)	work in process inventory				41,595
	Factory overhead				6,200
	Raw materials inventory					16,200
	Factory wages payable					31,595
c)	Factory overhead				1,800
	Accounts payable					1,800
d)	Factory overhead				2,500
	Accumulated depreciation					2,500
e)	Work in process inventory				9,000
	Factory overhead					9,000
f)	finished goods inventory				38,755
	work in process inventory					38,755
g)	Accounts receivable				38050
	Sales					38,050
	Cost of goods sold				26,200
	finished goods inventory					26,200
2)	Work in process inventory
	b)		15,000	f)		38,755
	b)		26,595
	e)		9,000
	end balance		11,840
	Finished goods inventory
	f)		38,755	g)		26,200
	End bal		12,555
3)	Schedule of Work in process account
	job	Direct	Direct	overhead	total
		materials	labor	applied
	job 304	1,800	2,400	1890	6,090
	job 306	1,770	2,900	1080	5,750
	total	3,570	5,300	2970	11,840
4)	Schedule of finished goods inventory
	job	Direct	Direct	overhead	total
		materials	labor	applied
	job 305	4,230	6,225	2100	12,555