Mathews Guitar Company makes high quality customized guitars Mathews uses a job order costing system Because the guitars are handmade, the company applies overhead based on direct labor hours At the beginning of the year, the company estimated that total manufacturing overhead costs would be $77,600 and that 19,400 direct labor hours would be worked At year end, Dave, the companys founder and CEO, gives you the following information regarding Mathewss operations 1 The beginning balances in the inventory accounts were Raw Materials Inventory $5,300 Work in Process Inventory $34,400 Finished Goods Inventory $48,000 2 During the year, the company purchased raw materials costing $85,000 All purchases were on account 3 The production department requisitioned $66,000 of raw materials for use in production Of those, 70 were direct materials and 30 were indirect materials 4 The company used 20,800 direct labor hours at a cost of $13 per hour during the year (credit Wages Payable) 5 The company used 4,200 indirect labor hours at a cost of $8 per hour (credit Wages Payable) 6 The company paid $46,600 for insurance, utilities, and property taxes on the factory All payments were cash payments 7 The company recorded factory depreciation of $17,100 8 The company applied manufacturing overhead to inventory based on the 20,800 labor hours actually worked during the year 9 Products costing $400,000 were completed during the year and transferred to the Finished Goods Inventory 10 During the year, the company sold products costing a total of $404,000 11 The company closes under and overapplied overhead to Cost of Goods Sold a repare journal entries for each of the transactions just listed b Using the information in the entries, record the transactions in T accounts for Raw Materials Inventory, Work in Process Inventory, Finished Goods Inventory, Manufacturing Overhead, and Cost of Goods Sold Show the ending balances for all accounts (Post entries in order presented in the problem )

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 27, 2024

Mathews Guitar Company makes high-quality customized guitars. Mathews uses a job order costing system. Because the guitars are handmade, the company applies overhead based on

Mathews Guitar Company makes high-quality customized guitars. Mathews uses a job order costing system. Because the guitars are handmade, the company applies overhead based on direct labor hours. At the beginning of the year, the company estimated that total manufacturing overhead costs would be $77,600 and that 19,400 direct labor hours would be worked. At year-end, Dave, the companys founder and CEO, gives you the following information regarding Mathewss operations:

The beginning balances in the inventory accounts were:

	Raw Materials Inventory		$5,300
	Work in Process Inventory		$34,400
	Finished Goods Inventory		$48,000

During the year, the company purchased raw materials costing $85,000. All purchases were on account.

The production department requisitioned $66,000 of raw materials for use in production. Of those, 70% were direct materials and 30% were indirect materials.

The company used 20,800 direct labor hours at a cost of $13 per hour during the year (credit Wages Payable).

The company used 4,200 indirect labor hours at a cost of $8 per hour (credit Wages Payable).

The company paid $46,600 for insurance, utilities, and property taxes on the factory. All payments were cash payments.

The company recorded factory depreciation of $17,100.

The company applied manufacturing overhead to inventory based on the 20,800 labor hours actually worked during the year.

Products costing $400,000 were completed during the year and transferred to the Finished Goods Inventory.

10.

During the year, the company sold products costing a total of $404,000.

11.

The company closes under- and overapplied overhead to Cost of Goods Sold.

a-repare journal entries for each of the transactions just listed.

b-Using the information in the entries, record the transactions in T-accounts for Raw Materials Inventory, Work in Process Inventory, Finished Goods Inventory, Manufacturing Overhead, and Cost of Goods Sold. Show the ending balances for all accounts. (Post entries in order presented in the problem.)