Lehigh Manufacturing Corporation was started with the issuance of common stock for $60,000. It purchased $14,000 of

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Lehigh Manufacturing Corporation was started with the issuance of common stock for $60,000. It purchased $14,000 of raw materials and worked on three job orders during 2019 for which data follow. (Assume that all transactions are for cash unless otherwise indicated.)
Direct Raw Materials Used Direct Labor
Job 1............................................................ $ 2,800.................. $ 6,000
Job 2............................................................... 4,000.................... 8,000
Job 3............................................................... 6,000................... 4,000
Total............................................................ $12,800................. $18,000
Factory overhead is applied using a predetermined overhead rate of $0.60 per direct labor dollar. Jobs 2 and 3 were completed during the period and Job 3 was sold for $20,000 cash. Lehigh paid $800 for selling and administrative expenses. Actual factory overhead was $11,300.
Required
a. Record the preceding events in a horizontal statements model. The first event for 2019 has been recorded as an example.
Lehigh Manufacturing Corporation was started with the issuance of common

b. Reconcile all subsidiary accounts with their respective control accounts.
c. Record the closing entry for over- or under applied manufacturing overhead in the horizontal statements model, assuming that the amount is insignificant.
d. Prepare a schedule of cost of goods manufactured and sold, an income statement, and a balance sheet for 2019.

Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on...
Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...
Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...
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Fundamental Managerial Accounting Concepts

ISBN: 978-1259569197

8th edition

Authors: Thomas Edmonds, Christopher Edmonds, Bor Yi Tsay, Philip Olds

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