Exercise 1: What is the total cost for Job 1 shown on the Job Cost Sheet? See circle on the printed exercise.
Exercise 1: After ALL of the entries for Exercise 1 have been recorded, what is the final account balance in the Work in Process Inventory account? See circle on the printed exercise.
EXERCISE 1: Use the T-accounts on the next page to record the following entries for Jen Manufacturing using a Job Order Cost system. Be sure to carefully review the text and other resources before attempting this problem. 1) Purchased raw materials on account costing $20,000 2) Materials costing $13,000 were requisitioned for use in making specific customer jobs (Job 1 $6,000 and Job 2: $7,000). An additional $1,000 in materials was requisitioned for general factory use 3) A total of $17,300 was incurred in wages for the period to be paid next month. Jen Manufacturing determined that $7,800 wages were payable to direct laborers (Job 1: $4,000 and Job 2: $3,800). An additional $9,500 were payable to factory employees who do not work directly on Jen's products 4) Utilities expenses on the factory totaling $5,000 were paid in cash. 5) $3,700 in depreciation was recorded on factory machines 6) Jen uses machine hours to apply Manufacturing Overhead to production. The Estimated Manufacturing Overhead for the year was $250,000. The Estimated Machine Hours for the year were 5,000 hours. Calculate the Predetermined Overhead Allocation Rate: a Estimated MOH Estimated Activity Base Predetermined Overhead Rate $ Machine Hours S per Machine Hour b. Use the Predetermined Overhead Allocation Rate to apply Manufacturing Overhead to production. Jen's actual usage was 400 machine hours during the period (Job 1:150 hours and Job 2: 250 hours). Record your entries in the T-accounts. machine hours = $ $ Job 1 Allocation: per Machine hour X Job 2 Allocation: $ per Machine hour X machine hours = $ 7) Job 1 was completed and transferred to Finished Goods Inventory. Use the Job Cost Sheet below to summarize the Job 1 costs. TOTAL Job Cost Sheet: Direct Direct Labor Allocated MOH Materials Job 1 $ S $ 8) Job 1 Products were sold on account to customers for $55,000. The cost of these products was calculated in Step 7. Be sure to record both entries (i.e. the sale and the cost) Work in Process Raw Materials Cash Manufacturing Overhead Inventory Inventory Beg:25,000 Beg: 300 IT Finished Goods Accumulated Wages Payable Accounts Receivable Depreciation Inventory Accounts Payable Cost of Goods Sold Sales The beginning balance in the Manufacturing Overhead account was $300. After all of the entries have been recorded for the period, what is the balance in the Manufacturing Overhead account? Is the balance Under or Over-Allocated? Manufacturing Overhead Balance? Under or Over-Allocated? 9) Make the adjusting entry to close out the Manufacturing Overhead balance to Cost of Goods Sold
