The following cost data relate to the manufacturing activitiesof Chang Company during the just completed year: Manufacturingoverhead costs incurred: Indirect materials $ 16,100 Indirect labor141,000 Property taxes, factory 9,100 Utilities, factory 81,000Depreciation, factory 149,700 Insurance, factory 11,100 Totalactual manufacturing overhead costs incurred $ 408,000 Other costsincurred: Purchases of raw materials (both direct and indirect) $411,000 Direct labor cost $ 71,000 Inventories: Raw materials,beginning $ 21,100 Raw materials, ending $ 31,100 Work in process,beginning $ 41,100 Work in process, ending $ 71,100 The companyuses a predetermined overhead rate of $20 per machine-hour to applyoverhead cost to jobs. A total of 20,800 machine-hours were usedduring the year. Required: 1. Compute the amount of underapplied oroverapplied overhead cost for the year. 2. Prepare a schedule ofcost of goods manufactured for the year.
Dillon Products manufactures various machined parts to customerspecifications. The company uses a job-order costing system andapplies overhead cost to jobs on the basis of machine-hours. At thebeginning of the year, the company used a cost formula to estimatethat it would incur $4,305,000 in manufacturing overhead cost at anactivity level of 574,000 machine-hours.
The company spent the entire month of January working on a largeorder for 12,500 custom-made machined parts. The company had nowork in process at the beginning of January. Cost data relating toJanuary follow:
Raw materials purchased on account, $313,000.
Raw materials used in production, $264,000 (80% direct materialsand 20% indirect materials).
Labor cost accrued in the factory, $171,000 (one-third directlabor and two-thirds indirect labor).
Depreciation recorded on factory equipment, $63,600.
Other manufacturing overhead costs incurred on account,$86,000.
Manufacturing overhead cost was applied to production on thebasis of 40,630 machine-hours actually worked during the month.
The completed job for 12,500 custom-made machined parts wasmoved into the finished goods warehouse on January 31 to awaitdelivery to the customer. (In computing the dollar amount for thisentry, remember that the cost of a completed job consists of directmaterials, direct labor, and applied overhead.)
Required:
1. Prepare journal entries to record items (a) through (f) above[ignore item (g) for the moment].
2. Prepare T-accounts for Manufacturing Overhead and Work inProcess. Post the relevant items from your journal entries to theseT-accounts.
3. Prepare a journal entry for item (g) above.
4. If 10,500 of the custom-made machined parts are shipped tothe customer in February, how much of this jobâs cost will beincluded in cost of goods sold for February?
The following cost data relate to the manufacturing activitiesof Chang Company during the just completed year: Manufacturingoverhead costs incurred: Indirect materials $ 16,100 Indirect labor141,000 Property taxes, factory 9,100 Utilities, factory 81,000Depreciation, factory 149,700 Insurance, factory 11,100 Totalactual manufacturing overhead costs incurred $ 408,000 Other costsincurred: Purchases of raw materials (both direct and indirect) $411,000 Direct labor cost $ 71,000 Inventories: Raw materials,beginning $ 21,100 Raw materials, ending $ 31,100 Work in process,beginning $ 41,100 Work in process, ending $ 71,100 The companyuses a predetermined overhead rate of $20 per machine-hour to applyoverhead cost to jobs. A total of 20,800 machine-hours were usedduring the year. Required: 1. Compute the amount of underapplied oroverapplied overhead cost for the year. 2. Prepare a schedule ofcost of goods manufactured for the year.
Dillon Products manufactures various machined parts to customerspecifications. The company uses a job-order costing system andapplies overhead cost to jobs on the basis of machine-hours. At thebeginning of the year, the company used a cost formula to estimatethat it would incur $4,305,000 in manufacturing overhead cost at anactivity level of 574,000 machine-hours.
The company spent the entire month of January working on a largeorder for 12,500 custom-made machined parts. The company had nowork in process at the beginning of January. Cost data relating toJanuary follow:
Raw materials purchased on account, $313,000.
Raw materials used in production, $264,000 (80% direct materialsand 20% indirect materials).
Labor cost accrued in the factory, $171,000 (one-third directlabor and two-thirds indirect labor).
Depreciation recorded on factory equipment, $63,600.
Other manufacturing overhead costs incurred on account,$86,000.
Manufacturing overhead cost was applied to production on thebasis of 40,630 machine-hours actually worked during the month.
The completed job for 12,500 custom-made machined parts wasmoved into the finished goods warehouse on January 31 to awaitdelivery to the customer. (In computing the dollar amount for thisentry, remember that the cost of a completed job consists of directmaterials, direct labor, and applied overhead.)
Required:
1. Prepare journal entries to record items (a) through (f) above[ignore item (g) for the moment].
2. Prepare T-accounts for Manufacturing Overhead and Work inProcess. Post the relevant items from your journal entries to theseT-accounts.
3. Prepare a journal entry for item (g) above.
4. If 10,500 of the custom-made machined parts are shipped tothe customer in February, how much of this jobâs cost will beincluded in cost of goods sold for February?
Related questions
The following cost data relate to the manufacturing activitiesof Chang Company during the just completed year: |
| Manufacturingoverhead costs incurred: | ||
| Indirect materials | $ | 15,800 |
| Indirect labor | 138,000 | |
| Property taxes,factory | 8,800 | |
| Utilities, factory | 78,000 | |
| Depreciation,factory | 150,600 | |
| Insurance, factory | 10,800 | |
| Total actualmanufacturing overhead costs incurred | $ | 402,000 |
| Other costsincurred: | ||
| Purchases of rawmaterials (both direct and indirect) | $ | 408,000 |
| Direct labor cost | $ | 68,000 |
| Inventories: | ||
| Raw materials,beginning | $ | 20,800 |
| Raw materials,ending | $ | 30,800 |
| Work in process,beginning | $ | 40,800 |
| Work in process,ending | $ | 70,800 |
The company uses a predetermined overhead rate to apply overheadcost to jobs. The rate for the year was $20 per machine-hour. Atotal of 20,500 machine-hours was recorded for the year. |
| 1.Compute the amount of underapplied or overapplied overheadcost for the year.
|
The following cost data relate to the manufacturing activitiesof Black Company during the just completed year: |
| Manufacturingoverhead costs: | ||
| Property taxes,factory | $ | 3,000 |
| Utilities, factory | 5,000 | |
| Indirect labor | 10,000 | |
| Depreciation,factory | 24,000 | |
| Insurance, factory | 6,000 | |
| Total actualmanufacturing overhead costs | $ | 48,000 |
| Other costsincurred: | ||
| Purchases of rawmaterials | $ | 32,000 |
| Direct labor cost | $ | 40,000 |
| Inventories: | ||
| Raw materials,beginning | $ | 8,000 |
| Raw materials,ending | $ | 7,000 |
| Work in process,beginning | $ | 6,000 |
| Work in process,ending | $ | 7,500 |
The company uses a predetermined overhead rate to apply overheadcost to jobs. The rate for the year was $5 per machine-hour; atotal of 10,000 machine-hours was recorded for the year. All rawmaterials ultimately become direct materialsânone are classified asindirect materials. |
| Required: |
| 1. | Compute the amount of underapplied or overapplied overhead costfor the year. |
| 2. | Prepare a schedule of cost of goods manufactured for the yearusing the indirect method. (Enter all deductions as anegative.) |
