CAN YOU PLEASE HELP WITH #10 10. Prepare the necessary Journal Entry related to the manufacturing cycle for this accounting period. Prepare journal entries for the accounting period. Use the accounts in the chart of accounts below.
Chart of Accounts 10000 11000 12000 12100 15000 15050 16000 20000 40000 50000 Cash Accounts Receivable DM Wood DM Glass Work-In-Process WIP Factory Overhead Finished Goods FG Wages Payable Sales COGS In the first journal entry record the purchase of the wood and the glass using cash. Record the materials transferred to WIP. Again use one journal entry to record the transfer of the wood and the glass. Record the direct labor into WIP using wages payable. Record the applied FOH. Record the actual FOH using cash. Record the over or under applied FOH Record the sale of the goods on account along with the cost of the inventory that was sold. Combine both into one journal entry showing the sale first and inventory second. a. b. c. d. e. f. g. Manufacturing Process Information Mr. Frank, the CEO of Frank's Frames, Inc. has begun a small manufacturing process that will manufacture picture frames and then sell the frames to merchandising companies. The manufacturing process starts with the construction of the wood molding, inspected and then glass will be installed as a final step in the process. Once the frames are completed they are then transferred to finished goods. This is a process cost system and the company elects to use the FIFO method of accounting for product costs. Direct material-wood is added 100% at the beginning of the process. Direct material glass is added 100% as the last step in the manufacturing process. At the beginning of the accounting period, Mr. Frank estimates that production will be 80,000 frames during the year. Estimated factory overhead is $40,000. This information is to be used to determine the application rate for the manufacturing overhead Estimated and actual direct labor costs totaled $29,100. Actual factory overhead costs totaled $36,000. The following information is available concerning direct materials. Direct Materials-Wood Beginning inventory Purchase of wood 0 board feet 240,000 board feet @ $1.60 a foot The company starts 75,000 frames. Each frame contains three board feet of wood molding Direct Material-Glass Beginning inventory Purchases of glass 0 panes of glass 240,000 panes of glass $.25 per pane Used 72,000 panes this period The Work-in-Process account has the following information: Ending work in process inventory is 100% complete as to wood molding 25% complete as to conversion costs 0% complete as to glass panes The Finished Goods account has the following Information: The finished goods inventory at January 1, 2018 had a balance of 20,000 frames at a cost of $140,000 and on December 31, 2018 had an ending balance of 10,000 frames The selling price of the frame is $10.00. tax rate is 30%. Selling and Administrative Costs totaled $100,000; 1. 40000/80000 0.50 per frame 2. The total number of frames to account are Opening WIP Started Frames to Account for 0 75000 75000 3. Equivalent units schedule Whole Units DM Wood DM GlassConversion Costs 0 72000 Beginning WIP Started and completed Completed/Transferred out72000 Ending WIP Equivalent units 2000 72000 72000 3000 3000 0 (0%) 750 (25%) 75000 72000 72750 4. Total cost of wood 75000 3 1.6 $360,000 Cost per frame $360000/75000 $4.8 per frame 5. Total cost of glass 72000 $0.25 $18000 Cost per frame-. $18000/72000 $0.25 6. Total conversion cost Direct laborFOH applied 29100 (72750*0.50)65475 Conversion cost per frame 65475/72750 $0.90 per frame 7. Total equivalent cost per frame cost of (woodlass+conversion cost) 4.8+0.250.90 $5.95 per frame 8. Prepare a cost of production report. This report should show all costs transferred into Work in Process and the cost transferred to finished goods. This process uses FIFO costing. Whole Units OM Wood OM Glass Conversion Costs Total Beginning WI Started and completecd 2000 2000 Ending WIP Equivalent units Cost Incurred Cost per Eq unit Cost of Opening WIP Cost of Started and completed(72000) Cost of transferred out Cost of Closing WiP 180006575 0.9 345600 18000 64800 9. Determine the amounts for the following a) Ending WIP Invento Equivalent Units Cost p/unit Cost Materials-Wood 3000 Conversion Costs 750 80 90 14,400 75 End. WIP (SSS)$15,075 b) Ending Finished Goods Inventory and Cost of Goods Sold Units 20000 Cost p/ unit Total Cost Beg. Finished Goods Inv Units Completed72000 and Transferred End. Finished Goods Inv $7.00 $5.95 $5.95 $140,000 $428,400 $59,500 10000 c) Over/Under applied Factory overhead Applied Factory Overhead. $36,375 Actual Factory Overhead. $36,000 OVERAPPLIED FOH 375 d) Gross margin, Income from operations and Net Income Sales @$10 820,000 COGS Gross Margin. $311,100 Selling and Adm. Expenses-$100,000) Inc. From Op. $211,100 Inc. Tax @ 30%. ($63,330) Net Income. $508,900 47,770
