Problem

Journal Entries in Job Order CostingKing Tool is a machine shop that uses job order costin...

Journal Entries in Job Order Costing

King Tool is a machine shop that uses job order costing. Overhead is applied to individual jobs at a predetermined rate based on direct labor costs. The job cost sheet for job no. 321 appears below.

JOB COST SHEET

JOB NUMBER: 321

DATE STARTED: May 10

PRODUCT: 2” Brass Check Valves

DATE COMPLETED: May 21

UNITS COMPLETED: 5,000

 

Direct materials used

$ 8,000

Direct labor

2,600

Manufacturing overhead applied

9,400

Total cost of job no. 321

$20,000

Unit cost ($20,000 ÷ 5,000 units)

$ 4

Prepare general journal entries to:

a. Summarize the manufacturing costs charged to job no. 321. (Use one compound entry.)


b. Record the completion of job no. 321.


c. Record the credit sale of 4,000 units from job no. 321 at a unit sales price of $10. Record in a separate entry the related cost of goods sold.

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