Analyzing Manufacturing Cost Accounts

Fire Rock Company manufactures designer paddle boards in a wide variety of sizes and styles. The following incomplete ledger accounts refer to transactions that are summarized for June:

Materials

Transaction Debit amount Transaction Credit amount

June $1$ Balance $28,100$ June $30$ Requisitions $($A$)$

June $30$ Purchases $113,000$

Work in Process

Transaction Debit amount Transaction Credit amount

June $1$ Balance $($B$)$ June $30$ Completed jobs $($F$)$

June $30$ Materials $($C$)$

June $30$ Direct labor $($D$)$

June $30$ Factory overhead applied $($E$)$

Finished Goods

Transaction Debit amount Transaction Credit amount

June $1$ Balance $0$ June $30$ Cost of goods sold $($G$)$

June $30$ Completed jobs $($F$)$

Wages Payable

Transaction Debit amount Transaction Credit amount

June $30$ Wages incurred $121,300$

Factory Overhead

Transaction Debit amount Transaction Credit amount

June $1$ Balance $22,200$ June $30$ Factory overhead applied $($E$)$

June $30$ Indirect labor $($H$)$

June $30$ Indirect materials $15,000$

June $30$ Other overhead $107,500$

In addition, the following information is available:

a$.$ Materials and direct labor were applied to six jobs in June:

Job No$.$ Style Quantity Direct Materials Direct Labor

$201$ T$100200$ $$20,500$ $$15,000$

$202$ T$20040032,40026,000$

$203$ T$40020013,2008,000$

$204$ S$20029033,06029,000$

$205$ T$30016016,30015,000$

$206$ S$1001204,8004,000$

Total $1,370$ $$120,260$ $$97,000$

b$.$ Factory overhead is applied to each job at a rate of $170\%$ of direct labor cost.

c$.$ The June $1$ Work in Process balance consisted of two jobs, as follows:

Job No$.$ Style Work in Process,

June $1$

$201$ T$100$ $$6,000$

$202$ T$20016,200$

Total $$22,200$

d$.$ Customer jobs completed and units sold in June were as follows:

Job No$.$ Style Completed

in June Units Sold

in June

$201$ T$100$ X $160$

$202$ T$200$ X $320$

$203$ T$4000$

$204$ S$200$ X $244$

$205$ T$300$ X $133$

$206$ S$1000$

$1.$ Determine the missing amounts associated with each letter and complete the following table. If required, round amounts to the nearest dollar. If an answer is zero, enter in $"0".$ Enter all amounts as positive numbers.

Job No$.$ Quantity June $1$

Work in

Process Direct Materials Direct Labor Factory Overhead Total Cost Unit Cost Units Sold Cost of Goods Sold

No$.201$ fill in the blank $1$

$200$

$$6,000$ $$20,500$ $$15,000$ $fill in the blank $2$

$25,500$

$fill in the blank $3$

$67,000$

$fill in the blank $4$

$335$

fill in the blank $5$

$160$

$fill in the blank $6$

$53,600$

No$.202$ fill in the blank $7$

$400$

$16,20032,40026,000$ fill in the blank $8$

$44,200$

fill in the blank $9$

$118,800$

fill in the blank $10$

$297$

fill in the blank $11$

$320$

fill in the blank $12$

$95,040$

No$.203$ fill in the blank $13$

$200$

$13,2008,000$ fill in the blank $14$

$13,600$

fill in the blank $15$

$34,800$

fill in the blank $16$

$0$

fill in the blank $17$

$0$

No$.204$ fill in the blank $18$

$290$

$33,06029,000$ fill in the blank $19$

$49,300$

fill in the blank $20$

$111,360$

fill in the blank $21$

$384$

fill in the blank $22$

$244$

fill in the blank $23$

$93,696$

No$.205$ fill in the blank $24$

$160$

$16,30015,000$ fill in the blank $25$

$25,500$

fill in the blank $26$

$56,800$

fill in the blank $27$

$355$

fill in the blank $28$

$133$

fill in the blank $29$

$47,215$

No$.206$ fill in the blank $30$

$120$

$4,8004,000$ fill in the blank $31$

$6,800$

fill in the blank $32$

$15,600$

fill in the blank $33$

$0$

fill in the blank $34$

$0$

Total fill in the blank $35$

$1,370$

$$22,200$ $$120,260$ $$97,000$ $fill in the blank $36$

$164,900$

$fill in the blank $37$

$404,360$

$fill in the blank $38$

$289,551$

Line Item Description Amount

A$.$ Materials Requisitions $fill in the blank $39$

$113,000$

B$.$ Work in Process Beginning Balance $fill in the blank $40$

$22,200$

C$.$ Direct Materials $fill in the blank $41$

$120,260$

D$.$ Direct Labor $fill in the blank $42$

$97,000$

E$.$ Factory overhead applied $fill in the blank $43$

$164,900$

F$.$ Completed jobs $fill in the blank $44$

G$.$ Cost of goods sold $fill in the blank $45$

$289,551$

H$.$ Indirect labor $fill in the blank $46$

$2.$ Determine the June $30$ balances for each of the inventory accounts and factory overhead. Use the minus sign to indicate any credit balances.

Inventory Accounts Amount

Materials $fill in the blank $47$

Work in Process $fill in the blank $48$

Finished Goods $fill in the blank $49$

Factory Overhead $fill in the blank $50$

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$1.$

a & c$.$ Direct and indirect materials are requisitioned. Direct materials are recorded in work in process and indirect materials are recorded in factory overhead.

b$.$ The beginning work in process information is given.

d$,$ e & h$.$ Direct labor cost information is given. Overhead is applied based on direct labor cost.

f & g$.$ Beginning work in process balances plus all current period manufacturing costs are included in the cost of completed jobs and jobs sold.

$2.$ Insert your amounts calculated in $(1)$ into the T accounts. Then determine the ending balances.