Critical Thinking: General Journal
In an Excel spreadsheet configured similarly to the journal shown below, prepare journal entries (in journal entry form) for the following transactions. If no entry is required, write "no entry." Omit explanations.
March 1 Jean Kelly opened a dance school, called Jean's Dance Studio, by depositing $15,000 into a business bank account.
March 2 Paid three months' rent in advance, $1,800.
March 4 Hired a part-time assistant, to be paid $250 per week, starting next week.
March 6 Purchased sound equipment for $2,000. Paid $400 in cash, the remainder to be paid in installments of $800 every two weeks.
March 8 Signed up five students, who will begin lessons on March 10, at $80 per week per student.
March 17 Received the first week's tuition from four students; the fifth student will remit payment in three days.
March 17 Paid the assistant his first week's wages.
March 20 Received payment from the fifth student.
March 21 Paid the first installment on the sound equipment purchased on March 6.
March 23 Received an electric bill of $100, to be paid April 1.
Critical Thinking: Year-end Adjustments
In an Excel spreadsheet configured similarly to the journal shown below, prepare year-end adjustments to the following situations. Omit explanations.
1. Accrued interest on notes receivable is $105.
2. Of the $12,000 received in advance of earning a service, one-third was still unearned by year end.
3. Three years' rent, totaling $36,000, was paid in advance at the beginning of the year.
4. Services totaling $5,300 had been performed, but not yet billed.
5. Depreciation on trucks totaled $3,400 for the year.
6. Supplies available for use totaled $690. However, by year end, only $100 in supplies remained.
7. Payroll for the five-day work week, to be paid on Friday, is $30,000. Year end falls on a Monday.
For ACT 305
Critical Thinking: Cost of Goods Manufactured Statement
Denny Corporation, a manufacturing company, produces a single product. The following information has been taken from the company's production, sales, and cost records for the year just completed:
Production in units 51,000
Direct labor $120,325
Raw materials purchased $325,019
Manufacturing overhead $250,265
Selling and administrative expenses $422,100 Raw Materials, Beginning $62,900
Raw Materials, Ending $45,345
Work in Process, Beginning $52,984
Work in Process, Ending $58,777
Prepare the cost of goods manufactured statement. Provide your answers in an Excel spreadsheet, clearly organized.
Critical Thinking: Job Costing Problem (50 points)
Hoover Inc. uses a job-order coding system. The company's inventory balances on February 1, the start of its fiscal year, were as follows:
Raw Materials Inventory $69,325
Work in Process Inventory $55,100
Finished Goods Inventory $81,256
During the year, the following transactions were completed:
a. Raw materials were purchased on account, $215,221.
b. Raw materials were issued from the storeroom for use in production, $198,000 (70% direct and 30% indirect).
c. Employee salaries and wages were accrued as follows: direct labor, $243,300; indirect labor, $98,750;
and selling and administrative salaries, $72,340.
d. Utility costs were incurred in the factory, $79,233.
e. Advertising costs were incurred. $110,600.
f. Prepaid insurance expired during the year, $35,000 (80% related to factory operations, and 20% related to selling and administrative activities).
g. Depreciation was recorded, $192,100 (75% related to factory assets, and 25% related to selling and administrative assets).
h. Manufacturing overhead was applied to jobs at the rate of 160% of direct labor cost.
i. Goods that cost $720,200 to manufacture according to their job cost sheets were transferred to the finished goods warehouse.
j. Sales for the year totaled $1,293,300 and were all on account. The total cost to manufacture these goods according to their job cost sheets was $725,825.
Submit your assignment as an Excel spreadsheet with each tab labeled by item number. Demonstrate the following:
1. Prepare the journal entries to record the transactions for the year.
2. Prepare the T-accounts for raw materials inventory, work in process inventory, finished goods inventory, manufacturing overhead, and cost of goods sold. Don't forget to enter the beginning balances in the inventory accounts.
3. Is manufacturing overhead underapplied or overapplied for the year? Prepare a journal entry to close this balance to cost of goods sold.
Provide your answers in an Excel spreadsheet, clearly organized.