ACCT 212 Connect Homework 2 Job Order Costing Assignment solutions complete answers

ACCT 212 Connect Homework 2 Job Order Costing Assignment solutions complete answers 

 

Following are simplified job cost sheets for three custom jobs at the end of June for Custom Patios.

 

Job Number 102
Materials
$ 43,000
Labor
16,000
Overhead
6,880
 

Job Number 103
Materials
$ 56,000
Labor
29,100
Overhead
12,513
 

Job Number 104
Materials
$ 63,000
Labor
46,000
Overhead
19,780
 

All jobs were started in June. Overhead is applied with a predetermined rate based on direct labor cost. Jobs 102 and 103 were finished in June, and Job 104 will be finished in July.

1. What was the total cost of direct materials requisitioned in June?
2. How much total direct labor cost was incurred in June?
3. How much total cost is transferred to Finished Goods Inventory in June?

 

Information on Kwon Manufacturing’s activities for its first month of operations follows:
 

 

a.   Purchased $100,300 of raw materials on credit.

b.   Materials requisitions show the following materials used for the month.

 

Job 201
$ 48,500
Job 202
23,900
Total direct materials
72,400
Indirect materials
8,920
Total materials used
$ 81,320
 

c.   Time tickets show the following labor used for the month.

 

Job 201
$ 39,500
Job 202
12,900
Total direct labor
52,400
Indirect labor
24,500
Total labor used
$ 76,900
 

d.   Applied overhead to Job 201 and to Job 202 using a predetermined overhead rate is 80% of direct materials cost.

e.   Transferred Job 201 to Finished Goods Inventory.

f.     (1) Sold Job 201 for $164,660 on credit. (2) Record cost of goods sold for Job 201.

g.   Incurred the following actual other overhead costs for the month.

 

Depreciation of factory equipment
$ 32,300
Rent on factory building (payable)
530
Factory utilities (payable)
830
Expired factory insurance
3,300
Total other factory overhead costs
$ 36,960
1. Prepare a job cost sheet for Job 201 and for Job 202 for the month.
2. Compute gross profit on the sale of Job 201.

 

Prepare journal entries to record the transactions reflected in items a through g.

 

Post entries for transactions a through g to the T-accounts. Each of T-accounts started the month with a zero balance.

 

The following information is available for ADT Company, which produces special-order security products and uses a job order costing system. Overhead is applied using a predetermined overhead rate of 55% of direct labor cost.

 

Inventories
Beginning of period
End of Period
Raw materials
$ 45,000
$ 39,000
Work in process
9,100
19,200
Finished goods
67,000
33,700
 

Cost incurred for the period
Raw materials purchases
$ 178,000
Factory payroll
150,000
Factory overhead (actual)
 
Indirect materials used
7,000
Indirect labor used
34,500
Other overhead costs
108,000
1. In the Raw Materials Inventory T-account, insert amounts for beginning and ending balances along with purchases and indirect materials used. Solve for direct materials used in the period.
2. Compute the cost of direct labor used for the period.
3. In the Work in Process Inventory T-account, insert amounts for beginning and ending balances along with direct materials used (from part 1), direct labor used (from part 2), and applied overhead. Solve for cost of goods manufactured in the period.
4. In the Finished Goods Inventory T-account, insert amounts for beginning and ending balances along with cost of goods manufactured (from part 3). Solve for cost of goods sold in the period (do not consider any under- or overapplied overhead).
5. In the Factory Overhead T-account, insert amounts for indirect materials used, indirect labor used, other overhead costs, and applied overhead. Solve for underapplied or overapplied overhead.

 

1. Raw materials purchases for cash.
2. Direct materials used.
3. Indirect materials used.

Prepare journal entries for the above transactions for the period.

 

1. Direct labor used (recorded as factory wages payable).
2. Indirect labor used (recorded as factory wages payable).
 
Prepare journal entries for the above transactions for the period.

 

1. Incurred other actual overhead costs (all paid in Cash).
2. Applied overhead to work in process.
 
Prepare journal entries for the above transactions for the period.

 

Prepare journal entries to record transactions a through h.
 

a.   Raw materials purchased on credit, $90,000.

b.   Direct materials used, $39,500. Indirect materials used, $18,000.

c.   Direct labor used, $40,000. Indirect labor used, $20,000. (Record using Factory Wages Payable.)

d.   Paid cash for other actual overhead costs, $7,625.

e.   Applied overhead at the rate of 125% of direct labor cost.

f.     Transferred cost of jobs completed to finished goods, $65,000.

g.   Sales of jobs on credit was $92,800.

h.   Cost of jobs sold was $65,000.

 

Lorenzo Company applies overhead to jobs on the basis of direct materials cost. At year-end, the Work in Process Inventory account shows the following.
 

Work in Process Inventory
Debit
Credit
Beginning
0
 
 
Direct materials used
1,000,000
 
 
Direct labor used
260,000
 
 
Overhead
430,000
 
 
 
 
1,593,000
Cost of goods manufactured
Ending
97,000
 
 
 
1. Determine the predetermined overhead rate used (based on direct materials cost).
2. Only one job remains in work in process inventory at year-end. Its direct materials cost is $22,000. How much direct labor cost and applied overhead are assigned to this job?

 

Tasty Bakery applies overhead based on direct labor costs. The company reports the following costs for the year: direct materials, $670,000; direct labor, $3,200,000; and overhead applied, $1,920,000.


1. Determine the company’s predetermined overhead rate for the year.
2. The ending balance of its Work in Process Inventory account was $73,000, which included $22,000 of direct labor costs. Determine the direct materials costs in ending Work in Process Inventory.

 

At the beginning of the year, Mirmax set its predetermined overhead rate for movies produced during the year by using the following estimates: overhead costs, $2,226,000, and direct labor costs, $420,000. At year-end, the company’s actual overhead costs for the year are $2,215,100 and actual direct labor costs for the year are $420,000.

1. Determine the predetermined overhead rate using estimated direct labor costs.
2. Enter the actual overhead costs incurred and the amount of overhead cost applied to movies during the year using the predetermined overhead rate. Determine whether overhead is over- or underapplied (and the amount) for the year.
3. Prepare the entry to close any over- or underapplied overhead to Cost of Goods Sold. 



 

Sofía Gomez runs a mobile pet grooming service. She charges $32 direct labor per grooming hour. She applies overhead to jobs on the basis of grooming hours. She predicts 920 grooming hours for the year. Her estimated overhead costs for the year follow.
 

Van depreciation
$ 5,300
Van insurance expense
$ 1,120
Tool depreciation
$ 470
Van maintenance
1,440
Indirect materials
720
Other overhead
1,070

1. Compute the predetermined overhead rate using estimated grooming hours.
2. Sofía has been asked to groom 3 large dogs. She expects this job to require a total of 12 direct labor grooming hours. Compute her total cost (direct labor plus applied overhead) for this job.
3. If Sofía targets a markup of 25% on the total cost for each job, what price should she quote for the job in part2?

 

Marco Company shows the following costs for three jobs worked on in April.
 

 
Job 306
Job 307
Job 308
Balances on March 31
 
 
 
Direct materials used (in March)
$ 28,000
$ 38,000
 
Direct labor used (in March)
22,000
19,000
 
Overhead applied (March)
11,000
9,500
 
Costs during April
 
 
 
Direct materials used
139,000
220,000
$ 115,000
Direct labor used
102,000
154,000
102,000
Overhead applied
?
?
?
Status on April 30
Finished (sold)
Finished (unsold)
In process
 

Additional Information 

a.   Raw Materials Inventory has a March 31 balance of $82,000.

b.   Raw materials purchases in April are $510,000, and total factory payroll cost in April is $382,000.

c.   Actual overhead costs incurred in April are indirect materials, $60,000; indirect labor, $24,000; factory rent, $31,000; factory utilities, $21,000; and factory equipment depreciation, $52,000.

d.   Predetermined overhead rate is 50% of direct labor cost.

e.   Job 306 is sold for $670,000 cash in April.

Required:
1. Determine the amount of overhead applied to each job in April.

 

2. Determine the total cost assigned to each job as of April 30 (including the balances from March 31).

 

a. Materials purchases (on credit).
b. Direct materials used.
c. Direct labor used (and paid in cash) and assigned to Work in Process Inventory.
d. Indirect materials used and assigned to Factory Overhead.
e. Indirect labor used (and paid in cash) and assigned to Factory Overhead.
f. Overhead costs applied to Work in Process Inventory.
g. Actual other overhead costs incurred (Factory rent and utilities are paid in cash.)
h. Transfer of Jobs 306 and 307 to Finished Goods Inventory.
i. Cost of goods sold for Job 306.
j. Revenue from the sale of Job 306 received in cash.
k. Close underapplied or overapplied overhead to the Cost of Goods Sold account.

3. Prepare journal entries for the month of April to record the above transactions.

 

4. Prepare a schedule of cost of goods manufactured for the month end April 30.