Exercise 12-6A (Algo) Job-order costing in a manufacturing company LO 12-2 Rundle Corporation makes custom-order furniture to meet the needs of persons with disabilities. On January 1, Year 2, the company had the following account balances: $87,000 for both cash and common stock. In Year 2, Rundle worked on three jobs. The relevant direct operating costs follow. Direct Labor Job 1 Job 2 Job 3 Total $ 4,200 2,800 8,000 $15,000 Direct Materials $ 5,500 2,100 4,300 $11,900 Rundle's predetermined manufacturing overhead rate was $0.40 per direct labor dollar. Actual manufacturing overhead costs amounted to $5,746. Rundle paid cash for all costs. The company completed and delivered Jobs 1 and 2 to customers during the year. Job 3 was incomplete at the end of the year. The company sold Job 1 for $16,000 cash and Job 2 for $7,800 cash. Rundle also paid $3,500 cash for selling and administrative expenses for the year. Rundle uses a just-in-time inventory management system. Consequently, it does not have raw materials inventory. Raw materials purchases are recorded directly in the Work in Process Inventory account. Required a. Record the preceding events in a horizontal statements model. The first row shows beginning balances. b. Record the entry to close the amount of underapplied or overapplied overhead for the year to Cost of Goods Sold in the expense category) in the horizontal financial statements model. c. Determine the gross margin for the year. Complete this question by entering your answers in the tabs below. Req A and B ReqC Screenshot Record the preceding events in a horizontal statements model. The first row shows beginning balances. Record the entry to close the amount Complete this question by entering your answers in the tabs below. Req A and B Reqc Record the preceding events in a horizontal statements model. The first row shows beginning balances. Record the entry to close the amount for the year to Cost of Goods Sold in the expense category) in the horizontal financial statements model. (Enter costs of each job individuall balances with a minus sign.) Assets Work in Finished Process Goods Cash + Manufacturing Overhead Equity Common + Stock 87,000 + Retained Earnings Revenue - Expense = Net Income 87,000 + + + = + + + + = + + + + - = + + + + + + + + - = + + + + = + + + + + = + + + = + + + = + = + + + + + + + = + + + + + + + + + + + + = + + + + + + + + = + + + + + + + + + + + + Screenshot 87,000 + 0 + 0 + 0 = = 87,000 + 0 0 - 0 Rundle's predetermined manufacturing overhead rate was $0.40 per direct labor dollar. Actual manufacturing overhead costs amounted to $5,746. Rundle paid cash for all costs. The company completed and delivered Jobs 1 and 2 to customers during the year. Job 3 was incomplete at the end of the year. The company sold Job 1 for $16,000 cash and Job 2 for $7,800 cash. Rundle also paid $3,500 cash for selling and administrative expenses for the year. Rundle uses a just-in-time inventory management system. Consequently, it does not have raw materials inventory. Raw materials purchases are recorded directly in the Work in Process Inventory account. Required a. Record the preceding events in a horizontal statements model. The first row shows beginning balances. b. Record the entry to close the amount of underapplied or overapplied overhead for the year to Cost of Goods Sold (in the expense category) in the horizontal financial statements model. c. Determine the gross margin for the year. Complete this question by entering your answers in the tabs below. Reg A and B Reqc Determine the gross margin for the year. Gross margin
