Dori Hatami is the chief financial officer of Gotham Industries, a company that makes special-order sound systems for home theaters. Her records for February revealed the following information:

Beginning inventory balances

Materials Inventory .............$27,450

Work in Process Inventory ......... 22,900

Finished Goods Inventory ........... 19,200

Direct materials purchased and received

February 6 ................ $7,200

February 12 ............... 8,110

February 24 ............... 5,890

Direct labor costs

February 14 ...............$13,750

February 28 ................ 13,230

Direct materials requested for production

February 4 .............$9,080

February 13 ............. 5,940

February 25 ............. 7,600

Job order cost cards for jobs in process on February 28 had the following totals:

The predetermined overhead rate for the month was 140 percent of direct labor costs. Sales for February totaled $152,400, which represented a 70 percent markup over the cost of production.

Required

1. Using T accounts for Materials Inventory, Work in Process Inventory, Finished Goods Inventory, Overhead, Accounts Receivable, Factory Payroll, Sales, and Cost of Goods Sold, reconstruct the transactions in February.

2. Compute the cost of units completed during the month.

3. What was the total cost of goods sold during February?

4. Determine the ending balances in the inventory accounts.

5. During the first week of March, Jobs AJ-10 and AJ-14 were completed. No additional direct materials costs were incurred, but Job AJ-10 needed $720 more of direct labor, and Job AJ-14 needed an additional $1,140 of direct labor. Job AJ-10 was 40 units; Job AJ-14, 55 units. Compute the product unit cost for each completed job (round to two decimalplaces).

Transcribed Image Text:

Direct Direct Job No. Materials Labor Overhead A10 S3,220 $1,810 $2,534 AJ-14 AJ-15 AJ-16 3,880 2,980 4,690 2,110 1,640 2,370 2,954 2,296 3,318