Froya Fabrikker A S of Bergen, Norway, is a small company that manufactures specialty heavy equipment for use in North Sea oil fields The company uses a job order costing system and applies manufacturing overhead cost to jobs on the basis of direct labor hours Its predetermined overhead rate was based on a cost formula that estimated $351,500 of manufacturing overhead for an estimated allocation base of 950 direct labor hours The following transactions took place during the year (all purchases and services were acquired on account) a Raw materials purchased for use in production, $215,000 b Raw materials requisitioned for use in production (all direct materials), $200,000 c Utility bills were incurred, $62,000 (85 related to factory operations, and the remainder related to selling and administrative activities) d Salary and wage costs were incurred Direct labor (1,025 hours) $ 245,000 Indirect labor $ 93,000 Selling and administrative salaries $ 125,000 e Maintenance costs were incurred in the factory, $57,000 f Advertising costs were incurred, $139,000 g Depreciation was recorded for the year, $87,000 (80 related to factory equipment, and the remainder related to selling and administrative equipment) h Rental cost incurred on buildings, $112,000 (85 related to factory operations, and the remainder related to selling and administrative facilities) i Manufacturing overhead cost was applied to jobs, $ j Cost of goods manufactured for the year, $800,000 k Sales for the year (all on account) totaled $1,350,000 These goods cost $830,000 according to their job cost sheets The balances in the inventory accounts at the beginning of the year were Raw materials $ 33,000 Work in process $ 24,000 Finished Goods $ 63,000 Prepare a schedule of cost of goods manufactured 4 Prepare a journal entry to close any balance in the Manufacturing Overhead account to Cost of Goods Sold Prepare a schedule of cost of goods sold (If no entry is required for a transaction event, select No journal entry required in the first account field ) 5 Prepare an income statement for the year 6 Job 412 was one of the many jobs started and completed during the year The job required $8,300 in direct materials and 40 hours of direct labor time at a total direct labor cost of $9,200 If the job contained five units and the company billed at 60 above the unit product cost on the job cost sheet, what price per unit would have been charged to the customer

The Answer is in the image, click to view ...

Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Aug 31, 2024

Froya Fabrikker A/S of Bergen, Norway, is a small company that manufactures specialty heavy equipment for use in North Sea oil fields. The company uses

Froya Fabrikker A/S of Bergen, Norway, is a small company that manufactures specialty heavy equipment for use in North Sea oil fields. The company uses a job-order costing system and applies manufacturing overhead cost to jobs on the basis of direct labor-hours. Its predetermined overhead rate was based on a cost formula that estimated $351,500 of manufacturing overhead for an estimated allocation base of 950 direct labor-hours. The following transactions took place during the year (all purchases and services were acquired on account):

a.	Raw materials purchased for use in production, $215,000.
b.	Raw materials requisitioned for use in production (all direct materials), $200,000.
c.	Utility bills were incurred, $62,000 (85% related to factory operations, and the remainder related to selling and administrative activities).
d.	Salary and wage costs were incurred:


Direct labor (1,025 hours)	$	245,000
Indirect labor	$	93,000
Selling and administrative salaries	$	125,000

e.	Maintenance costs were incurred in the factory, $57,000.
f.	Advertising costs were incurred, $139,000.
g.	Depreciation was recorded for the year, $87,000 (80% related to factory equipment, and the remainder related to selling and administrative equipment).
h.	Rental cost incurred on buildings, $112,000 (85% related to factory operations, and the remainder related to selling and administrative facilities).
i.	Manufacturing overhead cost was applied to jobs, $ ?.
j.	Cost of goods manufactured for the year, $800,000.
k.	Sales for the year (all on account) totaled $1,350,000. These goods cost $830,000 according to their job cost sheets.

The balances in the inventory accounts at the beginning of the year were:

Raw materials

33,000

Work in process

24,000

Finished Goods

63,000

Prepare a schedule of cost of goods manufactured.

4.	Prepare a journal entry to close any balance in the Manufacturing Overhead account to Cost of Goods Sold. Prepare a schedule of cost of goods sold. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

5.	Prepare an income statement for the year.

6.	Job 412 was one of the many jobs started and completed during the year. The job required $8,300 in direct materials and 40 hours of direct labor time at a total direct labor cost of $9,200. If the job contained five units and the company billed at 60% above the unit product cost on the job cost sheet, what price per unit would have been charged to the customer?