For the year ended December 31, 2017, the job cost sheets of Cinta Company contained the following data.

Other data:
1. Raw materials inventory totaled $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 totaled $120,000.
6. Other manufacturing overhead consisted of indirect materials $14,000, indirect labor $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 labor
(4) Manufacturing overhead
(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 for2017.

Transcribed Image Text:

Job Direct Direct Manufacturing Total Number 7640 7641 7642 Explanation Materials Labor S25,000 $24,000 36,000 18,000 48,000 55,000 Overhead $28,800 43,200 S 77,800 109,200 50,600 148,600 179,000 Current years costs Balance 1/1 30,000 11,000 43,000 58,000 Current year's costs Current year's costs 57,600 66,000