Journal Entries, T. Accounts, Financial Statement

Southworth Company uses a job-order costing system and applies manufacturing overhead cost to jobs based on the cost of direct materials used in production. Its predetermined overhead rate was based on a cost formula that estimated $ 248,000 of manufacturing overhead for an estimated allocation base of

$ 155,000 direct materials dollars, the following took place during the year (all purchases and services were acquired on account) a. Raw materials purchased, $ 142,000

b. Raw materials requisitioned for use in production (all direct materials), $150,000.

c. Utility bills incurred in the factory, $21,000

d. Costs for salaries and wages were incurred as follows

Direct labor _________________________$216,000 Check figure

Indirect labor________________________ 90,000 Cost of good manufactured

Selling and administrative salaries________ 145,000 $ 90,000 $48.16 per unit

e. Maintenance costs incurred in the factory, $ 15,000

f. Advertising costs incurred, $130,00i0

g. Depreciation recorded for the year, $50,000 (90% relates to factory assets, and the remainder relates to selling and administrative assets)

h. Rental cost incurred on buildings, $ 90,000 (80% of the space is occupied by the factory, and 20% is occupied by sales and administration.

i. Miscellaneous selling and administrative costs incurred, $17,000

j. Manufacturing over4head cost was applied to jobs, $_____

k. Cost of goods manufactured for the year, $590,000.

l. Sales for the year (all on account) totaled $1,000,000. These goods cost $600,000 according to their job cost sheets.

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

Raw Materials____________________$18,000

Work in process_________________24,000

Finished goods_________________35,000

REQUIRED: 1. Prepare journal entries to record the above data.

2. Post your entries to T-Account (Dont forget to enter the opening inventory balances above) Determined the ending balances in the inventory accounts and in the manufacturing overhead accounts.

3. Prepare a statement of cost of goods manufactured.

4. Prepare a journal entry to close any balance in manufacturing overhead account to cost of good sold. Prepare a statement of cost of goods sold.

5. Prepare an income statement of the year.

6. Job 2018 was one of the many jobs started and completed during the year. The job required $3600 in direct materials and 400 hours of direct labor time at a rate of $11 per hour. If the job contained 500 units and the company billed at 75% above the unit product cost on the job cost sheet, what price per unit would been charge to the customer?