Question

Yurman Inc. uses a job-order costing system. During the month of May, the following transactions occurred:

May	1	Purchased materials on account for $29,570.
	3	Requisitioned materials totaling $24,530 for use in production. Of the total, $9,200 was for Job 58, $8,950 for Job 59, and the remainder for Job 60.
	31	Incurred direct labor for the month of $30,770, with an average wage of $17 per hour. Job 58 used 820 hours; Job 59, 580 hours; and Job 60, 410 hours.
	31	Incurred and paid actual overhead of $17,850 (credit Various Payables).
	31	Charged overhead to production at the rate of $4.60 per direct labor hour.
	31	Completed and transferred Jobs 58 and 59 to Finished Goods.
	31	Sold Job 57 (see beginning balance of Finished Goods) and Job 58 to their respective clients on account for a price of cost plus 40%.

Beginning balances as of May 1 were:

Materials	$2,330
Work in Process	0
Finished Goods (Job 57)	25,560

	Required:
1.	Prepare journal entries for transactions from May 1 through 31.
2.	Prepare brief job-order cost sheets for Jobs 58, 59, and 60.
3.	Calculate the ending balance of Raw Materials.
4.	Calculate the ending balance of Work in Process.
5.	Calculate the ending balance of Finished Goods.

Answer 1

Date	Account titles & Explanations					Debit	Credit
1-May	Raw materials inventory					29,570
	Accounts payable						29,570
3-May	Work in process inventory					24,530
	Raw materials inventory						24,530
31-May	Work in process inventory					30,770
	Factory wages						30,770
31-May	manufacturing overhead					17,850
	Various payables						17,859
31-May	Work in process inventory					8326
	manufacturing overhead						8326
31-May	Finished goods inventory					48,390
	work in process inventory						48,390
31-May	cost of goods sold					52,472
	Finished goods inventory						52,472
	Accounts receivable					73,461
	sales						73,461
2)	Job order cost sheets
			Job 58	Job 59	Job 60	total
	direct materials		9,200	8,950	6,380	24,530
	direct labor		13940	9860	6970	30770
	overhead applied		3772	2668	1886	8326
	total		26,912	21,478	15,236	63,626
3)	Raw materials ending balance is
	opening	2,330	WIP	24,530
	purchase	29,570
	end bal	7,370
4)	work in process ending balance
	opening	0	finished	48,390
	DM	24,530
	DL	30770
	OH	8326
	end bal	15,236
5)	finished goods ending balance
	opening	25,560	COGS	52,472
	WIP	48,390
	End bal	21,478