M.com @ Bikaner University
I love reading books, travelling. I love to play cricket.
ABC Costing, Absorption Costing, Accounting Cycle, Accounting Equation, Accounting for Government, Accounting for Pensions, Accounting Information System, Accounting Standard Codifications, Accounting: Concepts and Principles, Accrual & Cash Basis
I am a commerce graduate from a renowned University of India. Having 3 years of experience as an online tutor in Accounting. I taught undergraduate/postgraduate for the various competitive exams which are related to Accounting. I then started working as a subject matter expert. I helped hundred of students to understanding the Accounting topics they were having trouble with. I have an expertise in accounts and can help the student in solving the question in easiest possible way and with the maximum accuracy. I love to teach!
Josie Inc. has provided the following information for the year ended 20x8: Purchased raw materials on account for $120,000. Issued $114,600 in raw materials to production ($21,100 were not traceable to specific jobs). Incurred $100,723 in direct labor costs (14,389 hours) and $61,000 in supervision costs (paid in cash). Incurred the following additional manufacturing overhead costs: factory lease $23,900 (paid in cash); depreciation on equipment $19,500; custodial supplies $6,500 (paid in cash). Incurred the following nonmanufacturing costs, both paid in cash: advertising $73,800; sales commissions $86,200. Applied manufacturing overhead to jobs in process at a rate of $12 per direct labor hour. Completed jobs costing a total of $344,200. Sold jobs for $426,500 on account. The cost of the jobs was $341,800. Closed the Manufacturing Overhead account balance. Prepare the journal entries to record these transactions. Solution :- a Raw material $120,000 Account payable $120,000 b Work in process $114,600 Manufacturing overhead $21,100 Raw material $134,500 c Work in process $100,723 Manufacturing overhead $61,000 Cash $161,723 d Manufacturing overhead $49,900 Accumulated depreciation $19,500 Cash $30,400 e Advertising expense $73,800 Sales commissions $86,200 Cash $160,000 f Work in process (14389 * 12) $172,668 Manufacturing overhead $172,668 g Finished goods $344,200 Work in process $344,200 h Account receivable $426,500 Sales revenue $426,500 Cost of goods sold $341,800 Finished goods $341,800 i Manufacturing overhead $40,668 Cost of goods sold $40,668 (21,100 + 61,000 + 49,900 - 172,668)
Curtis Inc uses a job order costing system. Manufacturing overhead is applied on the basis of direct labor cost. Total manufacturing overhead was estimated to be $45,510 for the year; direct labor was estimated to total $151,700. (1/1) (12/31) Raw Materials Inventory $ 10,400 $ 12,500 Work in Process Inventory $ 23,600 $ 17,400 Finished Goods Inventory $ 34,300 $ 39,400 The following transactions have occurred during the year. Raw materials purchases $ 116,000 Direct materials used $ 107,000 Direct labor $ 147,700 Indirect materials used $ 6,900 Indirect labor $ 16,900 Factory equipment depreciation $ 24,000 Factory rent $ 19,300 Factory utilities $ 8,100 Other factory costs $ 7,000 (a) Calculate the predetermined overhead rate. (b) Calculate cost of goods manufactured. (c) Calculate the over- or underapplied overhead. (Input all amounts as positive values.) (d) Calculate adjusted cost of goods sold. Solution :- Predetermined overhead rate = 45510/151700= 30% Cost of Goods manufactured Direct materials: Material used in production 107000 Direct labor 147700 Manufacturing overhead applied 44310 Add: Beginning Work in process 23600 Less: Ending Work in process 17400 Cost of goods manufactured 305210 Overhead Underapplied = (6900+16900+24000+19300+8100+7000)-44310= 37890 Cost of goods manufactured 305210 Add: Beginning Finished inventory 34300 Cost of goods available for sale 339510 Less: Ending finished inventory 39400 Cost of Goods Sold 300110 Add: Underapplied overhead 37890 Adjusted Cost of Goods Sold 338000
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