1)Direct Labor Costs

During August, Hatch Company accumulated 710 hours of direct labor costs on Job 40 and 560 hours on Job 42. The total direct labor was incurred at a rate of $12 per direct labor hour for Job 40 and $15 per direct labor hour for Job 42.

Journalize the entry to record the flow of labor costs into production during August.

2)Factory Overhead Costs

During May, Bergan Company incurred factory overhead costs as follows: indirect materials, $8,800; indirect labor, $6,600; utilities cost, $4,800; and factory depreciation, $9,000.

Journalize the entry to record the factory overhead incurred during May 30. Refer to the Chart of Accounts for exact wording of account titles.

CHART OF ACCOUNTS

Bergan Company

General Ledger

ASSETS

110Cash

121Accounts Receivable

125Notes Receivable

126Interest Receivable

131Materials

132Work in Process

133Factory Overhead

134Finished Goods

141Supplies

142Prepaid Insurance

143Prepaid Expenses

181Land

191Factory

192Accumulated Depreciation-Factory

LIABILITIES

210Accounts Payable

221Utilities Payable

231Notes Payable

236Interest Payable

241Lease Payable

251Wages Payable

252Consultant Fees Payable

EQUITY

311Common Stock

340Retained Earnings

351Dividends

390Income Summary

REVENUE

410Sales

610Interest Revenue

EXPENSES

510Cost of Goods Sold

520Wages Expense

531Selling Expenses

532Insurance Expense

533Utilities Expense

534Office Supplies Expense

540Administrative Expenses

560Depreciation Expense-Factory

590Miscellaneous Expense

710Interest Expense

3)Factory Overhead Costs

During August, Darling Company incurred factory overhead costs as follows: indirect materials, $1,020; indirect labor, $2,360; utilities cost, $1,690; and factory depreciation, $5,000.

Journalize the entry to record the factory overhead incurred during August.

For a compound transaction, if an amount box does not require an entry, leave it blank.

4)Applying factory overhead

Instructions

Bergan Company estimates that total factory overhead costs will be $1,653,000 for the year. Direct labor hours are estimated to be 551,000.

Required:

A. For Bergan Company, determine the predetermined factory overhead rate using direct labor hours as the activity base. Round your answer to the nearest cent.

B. During May, Bergan Company accumulated 21,900 hours of direct labor costs on Job 200 and 23,500 hours on Job 305. Determine the amount of factory overhead applied to Jobs 200 and 305 in May.

C. Prepare the journal entry on May 30 to apply factory overhead to both jobs in May according to the predetermined overhead rate. Refer to the Chart of Accounts for exact wording of account titles.

CHART OF ACCOUNTS

Bergan Company

General Ledger

ASSETS

110Cash

121Accounts Receivable

125Notes Receivable

126Interest Receivable

131Materials

132Work in Process

133Factory Overhead

134Finished Goods

141Supplies

142Prepaid Insurance

143Prepaid Expenses

181Land

191Factory

192Accumulated Depreciation-Factory

LIABILITIES

210Accounts Payable

221Utilities Payable

231Notes Payable

236Interest Payable

241Lease Payable

251Wages Payable

252Consultant Fees Payable

EQUITY

311Common Stock

340Retained Earnings

351Dividends

390Income Summary

REVENUE

410Sales

610Interest Revenue

EXPENSES

510Cost of Goods Sold

520Wages Expense

531Selling Expenses

532Insurance Expense

533Utilities Expense

534Office Supplies Expense

540Administrative Expenses

560Depreciation Expense-Factory

590Miscellaneous Expense

710Interest Expense

Factory Overhead

A. For Bergan Company, determine the predetermined factory overhead rate using direct labor hours as the activity base. Round your answer to the nearest cent.

per direct labor hour

B. During May, Bergan Company accumulated 21,900 hours of direct labor costs on Job 200 and 23,500 hours on Job 305. Determine the amount of factory overhead applied to Jobs 200 and 305 in May.

Journal

C. Prepare the journal entry on May 30 to apply factory overhead to both jobs in May according to the predetermined overhead rate. Refer to the Chart of Accounts for exact wording of account titles.

DATEDESCRIPTION POST. REF. DEBIT CREDITASSETS LIABILITIES EQUITY

5)Job Costs

At the end of August, Rothchild Company had completed Jobs 40 and 42. Job 40 is for 10,000 units, and Job 42 is for 11,000 units.

The following data relate to these two jobs:

On August 4, Rothchild Company purchased on account 12,000 units of raw materials at $14 per unit. During August, raw materials were requisitioned for production as follows: 5,000 units for Job 40 at $8 per unit and 6,200 units for Job 42 at $14 per unit.

During August, Rothchild Company accumulated 3,500 hours of direct labor costs on Job 40 and 4,200 hours on Job 42. The total direct labor was incurred at a rate of $25.00 per direct labor hour for Job 40 and $23.50 per direct labor hour for Job 42.

Rothchild Company estimates that total factory overhead costs will be $810,000 for the year. Direct labor hours are estimated to be 90,000.

a.Determine the balance on the job cost sheets for Jobs 40 and 42 at the end of August.

Job 40 $

Job 42 $

b.Determine the cost per unit for Jobs 40 and 42 at the end of August. If required, round your answers to two decimal places.

Job 40 $

Job 42 $

6)Applying Factory Overhead

Rothchild Company estimates that total factory overhead costs will be $810,000 for the year. Direct labor hours are estimated to be 90,000.

a.For Rothchild Company, determine the predetermined factory overhead rate using direct labor hours as the activity base.

$per direct labor hour

b.During August, Rothchild Company accumulated 3,500 hours of direct labor costs on Job 40 and 4,200 hours on Job 42. Determine the amount of factory overhead applied to Jobs 40 and 42 in August.

c.Prepare the journal entry to apply factory overhead to both jobs in August according to the predetermined overhead rate.