Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Finch Construction Company began operations on January 1, Year 1, when it acquired $20,000 cash from the issuance of common stock. During the year, Finch

Finch Construction Company began operations on January 1, Year 1, when it acquired $20,000 cash from the issuance of common stock. During the year, Finch purchased $2,700 of direct raw materials and used $2,500 of the direct materials. There were 108 hours of direct labor worked at an average rate of $8 per hour paid in cash. The predetermined overhead rate was $3.00 per direct labor hour. The company started construction on three prefabricated buildings. The job cost sheets reflected the following allocations of costs to each building.

Job 1 : Direct Materials: $600 Direct Labor Hours: 28

Job 2: Direct Materials: $900 Direct Labor Hours: 52

Job 3: Direct Materials: $1000 Direct Labor Hours: 28

The company paid $51 cash for indirect labor costs. Actual overhead cost paid in cash other than indirect labor was $253. Finch completed Jobs 1 and 2 and sold Job 1 for $1,578 cash. The company incurred $140 of selling and administrative expenses that were paid in cash. Over- or underapplied overhead is closed to Cost of Goods Sold.

Prepare an income statement for Year 1.

image text in transcribed

FINCH CONSTRUCTION COMPANY Balance Sheet for Year 1 Assets $ 0 Total assets Equity Total equity $ 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

Auditing Diversity In Library Collections

Authors: Rosalind Washington, Sarah Voels

1st Edition

1440878749, 978-1440878749

More Books

Students also viewed these Accounting questions