Exercise 3-10 (Algo) Applying Overhead; Journal Entries; T-accounts (L03-1, LO3-2) Dillon Products manufactures various machined parts to customer specifications. The company uses a job-order costing system and applies overhead cost to jobs on the basis of machine-hours. At the beginning of the year, the company used a cost formula to estimate that it would incur $4.247.600 in manufacturing overhead cost at an activity level of 574,000 machine-hours. The company spent the entire month of January working on a large order for 12,000 custom- made machined parts. The company had no work in process at the beginning of January. Cost data relating to January follow a. Raw materials purchased on account, $320,000 b. Raw materials used in production, $270,000 (80% direct materials and 20% indirect materials). c Labor cost accrued in the factory, $177,000 (one-third direct labor and two-thirds indirect labor) d. Depreciation recorded on factory equipment. $62.200. e. Other manufacturing overhead costs incurred on account. $85,300 1. Manufacturing overhead cost was applied to production on the basis of 40,870 machine hours actually worked during the month g. The completed job for 12,000 custom-made machined parts was moved into the finished goods warehouse on January 31 to await delivery to the customer (In computing the dollar amount for this entry, remember that the cost of a completed job consists of direct materials, clirect labor, and applied overhead.) Required: 1. Prepare journal entries to record items (a) through (f) above lignore item (9) for the moment) Required: 1. Prepare journal entries to record items (a) through (f) above [ignore item (g) for the moment). 2. Prepare T-accounts for Manufacturing Overhead and Work in Process Post the relevant items from your journal entries to these T- accounts 3. Prepare a journal entry for item (g) above. 4. IF 10,500 of the custom-made machined parts are shipped to the customer in February, how much of this job's cost will be included in cost of goods sold for February? Complete the question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Prepare journal entries to record items (a) through (1) above [ignore item (g) for the moment). (If no entry is required for a transaction/event, select "No journal entry required in the first account field. Do not round intermediate calculations.) View transaction list View journal entry worksheet Credit No Transaction General Journal Debit 320.000 1 a Raw materials Accounts payable 320,000 1 a Raw materials Accounts payable 320,000 320,000 2 b. Work in process Manufacturing overhead Raw materials 216,000 54,000 270,000 3 0. Work in process Manufacturing overhead Wages and salaries payable 59,000 118,000 177,000 4 d. 62,200 Manufacturing overhead Accumulated depreciation 62,200 5 e. 85,300 Manufacturing overhead Accounts payable 85.300 302.438 6 f. Work in process Manufacturing overhead 302.438 Complete the question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Prepare T-accounts for Manufacturing Overhead and Work in Process. Post the relevant items from your journal entries to these T-acc Manufacturing Overhead Debit Debit Work in Process Credit Credit b c. C. d e. f. Ending Balance Ending Balance Required 1 Required 2 Required 3 Required 4 Prepare a journal entry for item (9) above. (If no entry is required for a transaction/event, select "No journal entry required in the first account field.) View transaction list Journal entry worksheet
