Company during its first year of operation (Assume that all transactions are cash transactions unless otherwise stated ) Transactions for January Year 1, First Month of Operation Issued common stock for $3,000 Purchased $210 of direct raw materials and $30 of production supplies Used $120 of direct raw materials Used 80 direct labor hours production workers were paid $4 80 per hour Expected total overhead costs for the year to be $1,650 and direct labor hours used during the year to be 1,000 Calculate an overhead rate and apply the appropriate amount of overhead costs to Work in Process Inventory Paid $72 for salaries to administrative and sales staff Paid $12 for indirect manufacturing labor Paid $105 for rent and utilities on the manufacturing facilities Started and completed 100 remote controls during the month all costs were transferred from the Work in Process Inventory account to the Finished Goods Inventory account Sold 75 remote controls at a price of $10 80 each Transactions for Remainder of Year 1 Acquired an additional $9,000 by issuing common stock Purchased $1,950 of direct raw materials and $450 of production supplies Used $1,500 of direct raw materials Paid production workers $4 80 per hour for 900 hours of work Applied the appropriate overhead cost to Work in Process Inventory Paid $780 for salaries of administrative and sales staff Paid $120 of indirect manufacturing labor cost Paid $1,200 for rental and utility costs on the manufacturing facilities Transferred 950 additional remote controls that cost $6 36 each from the Work in Process Inventory account to the Finished Goods Inventory account Determined that $84 of production supplies was on hand at the end of the accounting period Sold 850 remote controls for $10 80 each Determine whether the overhead is over or underapplied Close the Manufacturing Overhead account to the Cost of Goods Sold account Close the revenue and expense accounts Required For each of the above transactions, post the effects to the appropriate T accounts

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Posted on Sep 17, 2024

Company during its first year of operation. (Assume that all transactions are cash transactions unless otherwise stated.)

Transactions for January Year 1, First Month of Operation

Issued common stock for $3,000.
Purchased $210 of direct raw materials and $30 of production supplies.
Used $120 of direct raw materials.
Used 80 direct labor hours; production workers were paid $4.80 per hour.
Expected total overhead costs for the year to be $1,650 and direct labor hours used during the year to be 1,000. Calculate an overhead rate and apply the appropriate amount of overhead costs to Work in Process Inventory.
Paid $72 for salaries to administrative and sales staff.
Paid $12 for indirect manufacturing labor.
Paid $105 for rent and utilities on the manufacturing facilities.
Started and completed 100 remote controls during the month; all costs were transferred from the Work in Process Inventory account to the Finished Goods Inventory account.
Sold 75 remote controls at a price of $10.80 each.

Transactions for Remainder of Year 1

Acquired an additional $9,000 by issuing common stock.
Purchased $1,950 of direct raw materials and $450 of production supplies.
Used $1,500 of direct raw materials.
Paid production workers $4.80 per hour for 900 hours of work.
Applied the appropriate overhead cost to Work in Process Inventory.
Paid $780 for salaries of administrative and sales staff.
Paid $120 of indirect manufacturing labor cost.
Paid $1,200 for rental and utility costs on the manufacturing facilities.
Transferred 950 additional remote controls that cost $6.36 each from the Work in Process Inventory account to the Finished Goods Inventory account.
Determined that $84 of production supplies was on hand at the end of the accounting period.
Sold 850 remote controls for $10.80 each.
Determine whether the overhead is over- or underapplied. Close the Manufacturing Overhead account to the Cost of Goods Sold account.
Close the revenue and expense accounts.