Job Cost Sheet Remnant Carpet Company sells and installs commercial carpeting for office buildings. Remnant Carpet Company uses a job order cost system. When a prospective customer asks for a price quote on a job, the estimated cost data are inserted on an unnumbered job cost sheet. If the offer is accepted, a number is assigned to the job, and the costs incurred are recorded in the usual manner on the job cost sheet. After the job is completed, reasons for the variances between the estimated and actual costs are noted on the sheet. The data are then available to management in evaluating the efficiency of operations and in preparing quotes on future jobs. On October 1, Remnant Carpet Company gave Jackson Consulting an estimate of $3,360 to carpet the consulting firm's newly leased office. The estimate was based on the following data: Estimated direct materials: 30 meters at $31 per meter $ 930 Estimated direct labor: 28 hours at $30 per hour 840 Estimated factory overhead (75% of direct labor cost) 630 Total estimated costs $2,400 ) Markup (40% of production costs) 960 Total estimate $3,360 On October 3, Jackson Consulting signed a purchase contract, and the delivery and installation were completed on October 10. The related materials requisitions and time tickets are summarized as follows: Materials Requisition No. Description Amount 112 15 meters at $31 $465 114 19 meters at $31 589 Time Ticket No. Description Amount H10 14 hours at $30 $420 H11 18 hours at $30 540 Required: Enter amounts as positive numbers. 1. Complete that portion of the job order cost sheet that would be prepared when the estimate is given to the customer. 2. Record the costs incurred, and complete the job order cost sheet. JOB ORDER COST SHEET Customer Jackson Consulting Date Date wanted Date completed Job. No. ESTIMATE October 1 October 10 October 10 Direct Materials Direct Labor 30 Meters at $31 28 Hours at $30 Amount Direct Materials Direct Labor ED Factory Overhead Total Total Total cost 15:] ACTUAL Direct Materials Direct Labor Summary Mat. Req. No. Description Description Amount Item Amount Direct Materials 54:] 112 15 Meters at $31 14 Hours at $30 35:] Direct Labor I: 114 19 Meters at $31 18 Hours at $30 :] Factory Overhead [: Total 95:] Total Cost Entries for Costs in a Job Order Cost System Royal Technology Company uses a job order cost system. The following data summarize the operations related to production for March: . Materials purchased on account, $578,470. . Materials requisitioned, $485,910, of which $63,170 was for general factory use. . Factory labor used, $595,820, of which $113,210 was indirect. . Other costs incurred on account for factory overhead, $138,830; selling expenses, $214,030; and administrative expenses, $127,260. . Prepaid expenses expired for factory overhead were $26,610; for selling expenses, $22,560; and for administrative expenses, $16,200. . Depreciation of factory equipment was $26,610; of ofce equipment, $39,340; and of office building, $77,510. . Factory overhead costs applied to jobs, $329,730. . Jobs completed, $763,580. . Cost of goods sold, $740,440. _.:r:n_.,mn.nu-m Required: Journalize the entries to record the summarized operations. If an amount box does not require an entry, leave it blank. a. Materials purchased on account, $578,470. Entry Description Debit Credit a. Materials Accounts Payable V b. Materials requisitioned, $485,910, of which $63,170 was for general factory use. Entry Description Debit Credit b. Work in Process Factory Overhead Materials V c. Factory labor used, $595,820, of which $113,210 was indirect. Entry Description Debit Credit C. Work in Process Factory Overhead Wages Payable d. Other costs incurred on account for factory overhead, $138,830; selling expenses, $214,030; and administrative expenses, $127,260. Entry Description Debit Credit d. Factory Overhead Selling Expenses Administrative Expenses Accounts Payable Ve. Prepaid expenses expired for factory overhead were $26,610; for selling expenses, $22,560; and for administrative expenses, $16,200. Entry Description Debit Credit e. Factory Overhead Selling Expenses Administrative Expenses Prepaid Expenses V f. Depreciation of factory equipment was $26,610; of office equipment, $39,340; and of office building, $77,510. Entry Description Debit Credit f. Factory Overhead Depreciation Expense-Office Equipment Depreciation Expense-Office Building Accumulated Depreciation-Buildings and Equipment V g. Factory overhead costs applied to jobs, $329,730. Entry Description Debit Credit g. Work in Process Factory Overhead h. Jobs completed, $763,580. Entry Description Debit Credit h. Finished Goods V Work in Process V\fEntries and Schedules for Unfinished Jobs and Completed Jobs Hildreth Company uses a job order cost system. The following data summarize the operations related to production for April, the rst month of operations: a. Materials purchased on account, $2,800. 0. Materials requisitioned and faCtory labor used: Job No. Materials Factory Labor 101 $2,090 $1,810 102 2,550 2,440 103 1,690 1,190 104 5,730 4,490 105 3,640 3,420 106 2,650 2,170 For general factory use 710 2,680 c. Factory overhead costs incurred on account, $3,990. cl. Depreciation of machinery and equipment, $1,290. e. The factory overhead rate is $40 per machine hour. Machine hours used: Job No. Machine Hours 101 37 102 44 103 15 104 S3 105 21 106 20 Total 220 1'. Jobs completed: 101, 102, 103, and 105. 9. Jobs were shipped and customers were billed as follows: Job 101, $6,460; Job 102, $8,100; Job 105, $10,090. Required: 1. Joumalize the entries to record the summarized operations. If an amount box does not require an entry, leave it blank. g. Accounts Receivable V Sale Sales g Cost of Goods Sold Cost Finished Goods V 2. Post the appropriate entries to T accounts for Work in Process and Finished Goods, using the identifying letters as transaction codes. Insert memo account balances as of the end of the month. Work in Process (b) (f) (e) Bal Finished Goods (f) V (q) Bal.3. Prepare a schedule of unfinished jobs to support the balance in the work in process account. Hildreth Company Schedule of Unfinished Jobs Direct Factory Job Direct Labor Total Materials Overhead No. 104 $ $ $ No. 106 Balance of Work in Process, April 30 4. Prepare a schedule of completed jobs on hand to support the balance in the finished goods account. Hildreth Company Schedule of Completed Jobs Direct Factory Job Direct Labor Total Materials Overhead Finished Goods, April 30 (Job 103) V $ $ $ $Flow of Costs and Income Statement Technology Accessories Inc. is a designer, manufacturer, and distributor of accessories for consumer electronic products. Early in 20Y3, the company began production of a leather cover for tablet computers, called the iLeather. The cover is made of stitched leather with a velvet interior and fits snugly around most tablet computers. In January, $752,000 was spent on developing marketing and advertising materials. For the first six months of 20Y3, the company spent an additional $1,402,000 promoting the iLeather. The product was ready for manufacture on January 21, 20Y3. Technology Accessories Inc. uses a job order cost system to accumulate costs for the iLeather. Direct materials unit costs for the iLeather are as follows: Leather $10.00 Velvet 5 .00 Packaging 0.40 Total $15 .40 The actual production process for the iLeather is fairly straightforward. First, leather is brought to a cutting and stitching machine. The machine cuts the leather and stitches an exterior edge into the product. The machine requires one hour per 120 iLeathers. After the iLeather is cut and stitched, it is brought to assembly, where assembly personnel affix the velvet interior and pack the iLeather for shipping. The direct labor cost for this work is $0.50 per unit. The completed packages are then sold to retail outlets through a sales force. The sales force is compensated by a 20% commission on the wholesale price for all sales. Total completed production was 540,000 units during the year. Other information is as follows: Number of iLeather units sold in 20Y3 500,000 Wholesale price per unit $40 Factory overhead cost is applied to jobs at the rate of $1,200 per machine hour. There were an additional 21,000 cut and stitched iLeathers waiting to be assembled on December 31, 20Y3. In your computations, if required, round interim per unit costs to two decimal places and nal answers to the nearest whole dollar. Required: 1. Prepare an annual income statement for the iLeather product. Technology Accessories Inc. Income Statement For the Year Ended December 31, 20Y3 Sales Cost of Goods Sold Gross Profit Selling Expenses: Salespersons Commissions $ Advertising Design Advertising Expenses Total Selling Expenses Operating income Feedback 2. Determine the balances in the finished goods and work in process inventories for the iLeather product on December 31, 20Y3. Finished Goods Work in Process