Question
Custom Cabinetry has one job in process (Job 120) as of June 30; at that time, its job cost sheet reports direct materials of $6,600,
Custom Cabinetry has one job in process (Job 120) as of June 30; at that time, its job cost sheet reports direct materials of $6,600, direct labor of $2,900, and applied overhead of $2,610. Custom Cabinetry applies overhead at the rate of 90% of direct labor cost. During July, Job 120 is sold (on account) for $30,000, Job 121 is started and completed, and Job 122 is started and still in process at the end of the month. Custom Cabinetry incurs the following costs during July. |
July Product Costs | Job 120 | Job 121 | Job 122 | Total |
Direct materials | $1,600 | $6,400 | $2,700 | $10,700 |
Direct labor | 2,600 | 4,100 | 3,500 | 10,200 |
Overhead applied | ? | ? | ? | ? |
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1 | Prepare journal entries for the following in July. |
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| a | Direct materials used in production. | |||
| b | Direct labor used in production. | |||
| c | Overhead applied. | |||
| d | The sale of Job 120. | |||
| e | Cost of goods sold for Job 120.
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2. | Compute the July 31 balances of the Work in Process Inventory and the Finished Goods Inventory general ledger accounts. |
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