For the year ended December 31, 2016, the job cost sheets of DeVoe Company contained the following data:

Other data:
1. Raw materials inventory totalled $15,000 on January 1. During the year, $140,000 of raw materials were purchased on account.
2. Finished goods on January 1 consisted of Job No. 7638 for $87,000 and Job No. 7639 for $92,000. 3. Job No. 7640 and Job No. 7641 were completed during the year.
4. Job Nos. 7638, 7639, and 7641 were sold on account for $530,000.
5. Manufacturing overhead incurred on account totalled $120,000.
6. Other manufacturing overhead consisted of indirect materials $14,000, indirect labour $18,000, and depreciation on factory machinery $8,000.
Instructions
(a) Prove the agreement of Work in Process Inventory with job cost sheets pertaining to unfinished work. Calculate each of the following, then post each to the T account:
(1) Beginning balance,
(2) Direct materials,
(3) Direct labour,
(4) Manufacturing overhead, and
(5) Completed jobs.
(b) Prepare the adjusting entry for manufacturing overhead, assuming the balance is allocated entirely to Cost of Goods Sold.
(c) Determine the gross profit to be reported for 2016.

Transcribed Image Text:

tal Costs $77,800 109,200 50,600 148,600 179,000 Direct Manufacturing To Materials $25,000 30,000 11,000 43,000 58,000 Job Number Explanation Labour 7640 7641 7642 Balance 1/1 Current year's costs Balance 1/1 Current year's costs Current year's costs Overhead $28,800 43,200 21,600 57,600 66,000 $24,000 36,000 18,000 48,000 55,000