Question
Foley Company uses a job-order costing system. The following data relate to the month of October, the first month of the company%u2019s fiscal year: a.
Foley Company uses a job-order costing system. The following data relate to the month of October, the first month of the company%u2019s fiscal year:
a. | Raw materials purchased on account, $211,000. |
b. | Raw materials issued to production, $191,000 (80% direct and 20% indirect). |
c. | Direct labor cost incurred, $50,000; and indirect labor cost incurred, $22,000. |
d. | Depreciation recorded on factory equipment, $106,000. |
e. | Other manufacturing overhead costs incurred during October, $131,000 (credit accounts payable). |
f. | The company applies manufacturing overhead cost to production on the basis of $4 per machine-hour. A total of 76,000 machine-hours were recorded for October. |
g. | Production orders costing $515,000 according to their job cost sheets were completed during October and transferred to Finished Goods. |
h. | Production orders that had cost $449,000 to complete according to their job cost sheets were shipped to customers during the month. These goods were sold on account at 50% above cost. |
Required: | |
1. | Prepare journal entries to record the information given above. |
General Journal | Debit | Credit | |
a. | |||
b. | |||
c. | |||
d. | |||
e. | |||
f. | |||
g. | |||
h. | |||
|
2. | Prepare T-accounts for Manufacturing Overhead and Work in Process. Post the relevant information above to each account. Compute the ending balance in each account, assuming that Work in Process has a beginning balance of $36,000. (Record the transactions in the given order.) |
Manufacturing Overhead |
| | |||
| | |||
End. Bal | ||||
|
Work in Process |
| | |||
Beg. Bal | ||||
| | |||
End. Bal | ||||
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