Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Durham Company's trial balance as of January 1, the beginning of the current year, is shown below Cash Accounts Receivable Raw Materials Work in Process

image text in transcribed
image text in transcribed
image text in transcribed
Durham Company's trial balance as of January 1, the beginning of the current year, is shown below Cash Accounts Receivable Raw Materials Work in Process Pinished Goods Prepaid Insurance plant and Equipment Accumulated Depreciation Accounts Payable Capital Stock Retained varnings Total 5 3.000 13. 7.00 18.000 20.000 4,000 230,000 $ 42,00 30.000 350,00 20,000 5300,000 $300,000 Durham Company uses a job-order costing system. During the year, the following transactions took place a. Raw materials were purchased on account $45,000 b. Raw materials were requisitioned for use in production $40.000 (80% direct and 20% indirecto c Factory Utility costs were incurred: $14,600 d Depreciation was recorded on plant and equipment $28,000. Three-fourths of the depreciation relates to factory equipment and the remainder relates to selling and administrative equipment e. Costs for salaries and wages were incurred as follows Direct labour Indirect labour Sales Comissions Adeinistrative colares 540,000 $16.000 51,400 $25,000 Direct labour Indirect labour Sales Comissions Administrative salaries $40, $18,000 $10,400 $25,000 1. Prepaid insurance expired during the year $3,000 (80% relates to factory operations, and 20% relates to selling and administrative activities) g. Miscellaneous selling and administrative expenses were incurred: $18,000. h. Manufacturing overhead was applied to production. The company applies overhead on the basis of 150% of direct labour cost 1. Goods that cost $130,000 to manufacture according to their job cost sheets were transferred to the finished goods warehouse J Goods that had cost $120,000 to manufacture according to their job cost sheets were sold on account for $200,000 k Collections from customers during the year totalled $197,000 Payments to suppliers on account during the year totalled $100,000. payments to employees for salaries and wages totalled $90,000 Required: 1.& 2. Prepare a T-account for each account in the company's trial balance, and enter the beginning balances. Make an entry directly into the T-accounts for transactions (a) through (I). Also post adjusting or closing entries. If any Determine an ending balance for each T-account. Beg Ba Beg Bal K End. Bal Cash 8,000 197,000 15.000 Accounts Receivable 19.000 200.000 197 000 15 000 190.000 End Bal Beg Bal Work in Process 18.000 32.000 Raw Materials 7.000 45 000 Beg Bal 130 000 b 40.000 a 4. Prepare an income statement for the year. DURHAM COMPANY Income Statement For the Year Ended December 31 0 Selling and administrative expenses 0 $ 0

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Study Guide With Working Papers, Chapters 1-9 For Heintz/Parrys College Accounting

Authors: James A. Heintz, Robert W. Parry

21st Edition

1285059379, 9781285059372

More Books

Students also viewed these Accounting questions

Question

Explain the pattern of trade union membership and union structure

Answered: 1 week ago