Problem:
Using the Work in process inventory account
June production generated the following activity in Auto Chassis Company's Work in process inventory account:
|
Work in process inventory
|
|
Jun 1 Bal
|
20,000
|
|
Direct materials used
|
31,000
|
|
Direct labor assigned to jobs
|
33,000
|
|
Manufacturing overhead allocated to jobs
|
13,000
|
Additionally, Auto has completed Jobs 142 and 143, with total costs of $38,000 and $36,000, respectively.
Requirements
1. Prepare the journal entry for production completed in June.
2. Post the journal entry made in Requirement 1. Compute the ending balance in the Work in process account on June 30.
3. Prepare the journal entry to record the sale (on credit) of Job 143 for $46,000. Also, prepare the journal entry to record Cost of goods sold for Job 143.
4. What is the gross profit on Job 143? What other costs must gross profit cover?