PROVIDE ANSWERS IN EXCEL SHEET
The following transactions occurred in April at Steve's Cabinets, a custom cabinet firm:
1. Purchases $80,000 of material
2. Issued $4,000 of supplies from the material inventory
3. Purchases $56,000 of materials
4. Paid for the materials purchases in transaction(1)
5. Issued $68,000 in direct material to the production department
6. Incurred direct labor cost of $100,000, which were credited to Wages Payable
7. Paid $106,000 cash for utilities, power, equipment maintenance, and other miscellaneous items for the manufacturing plant
8. Applied overhead on the basis of 125% of $100,000 direct labor cost
9. Recognize depreciation on manufacturing property, plant, and equipment of $50,000
The following balance appeared in the accounts of Steve's Cabinet for April:
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Beginning
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Ending
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Material Inventory
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$148,200
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?
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Work=in-Process Inventory
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33,000
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?
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Finished Goods Inventory
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166,000
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143,200
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Cost of Goods Sold
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263,400
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Require
a. Prepare Journal entries to record the transactions
b. Prepare T-accounts to show the flow of cost during the period from Materials Inventory through Cost of Goods Sold
7.25
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Material Inventory
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Work-in Process Inventory
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BB(6/1) 75,000
447,000
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402,000
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Labor 350,000
EB (6/3) 400,000
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Finish Goods Inventory
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Cost of Gods Sold
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BB(6/1) 277,000
822,000
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819,000
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10,000
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Manufacturing Overhead Control
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Applied Manufacturing Overhead
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240,000
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240,000
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240,000
10,000
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250,000
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Additional information for June follows
- Labor wage was $35 per hours
- During the month, sales revenue was $1,020,000, an selling and administration cist were $222,000
- This company has no indirect material or supplies
- The company applies manufacturing overhead on the basis of direct labor-hours
Requires
a. Where was the cost of direct material purchases in June
b. What was the over-or under applied manufacturing overhead for June
c. What was the manufacturing overhead application rate in June
d. What was the cost of products completed during June?
e. What was the balance of the Work-process Investment account at the beginning of June
f. What was the operating profit for June? Any over-or under applied overhead is written off to Cost of Goods Sold
Southern Rim Parts estimates its manufacturing overhead to be $495,000 and its direct labor cost to be $900,000 for years 1. The first there jobs that Southern Rim worked on had actual direct cost of $20,000 for Job 301, $30,000 for Job 302, and $40,000 for Job 303. For the years, actual manufacturing overhead was $479,000 and total direct labor cost using predetermine rates
Required
1. How much overhead was assigned to each of the three jobs,301,302,303?
2. What was the over-or under applied manufacturing overhead for year 1
Refer to the information in Exercise 7-28. Prepare an entry to allocated the under-or over applied overhead. Overhead applied in each of the inventory accounts is as follows:
Work -in process Inventory $37,400
Finish goods inventory 102,850
Cost of gods sold 327,250
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Material Inventory
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Work-in Process Inventory
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EB(11/30) 56,400
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Labor 32,600
Dir. Materials 86,200
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Finish Goods Inventory
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Cost of Gods Sold
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EB(11/30) 101,000
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|
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Manufactriung Overhead Control
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Applied Manufacturing Overhead
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264,000
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Wages Payable
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Sales Revenue
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725,400
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Additional Data
a. Material of $113,600 were purchase during the month and the balance in the Material Inventory accounts increase by $11,000
b. Overhead is applied at the rate of 150% of direct labor cost
c. Sales are billed at 180% of cost of goods sold before the over- or under applied overhead is prorated
d. The balance in the Finish Goods Inventory account decrease by $28,600 during the month before any proration of under or over applied overhead
e. Total Credits to the wages payable account amounted to $202,000 for direct and indirect labor
f. Factory depreciation total $48,200
g. Overhead was under applied by $25.080. Overhead other than indirect labor ,indirect material , and depreciation was $198,480, which require payments in Cash. Under applied overhead is to be allocated.
h. The company has decided to allocate 25% of underappiled overhead to Work in Process Inventory, 15% to Finish Goods Inventory, and the balance to Cost of Goods Sold. Balance shown in T-Accounts are before any allocation