OPTIONS For ACCOUNTS are:

Account payable

Account receivable

Cost of sales

Factory Overhead

Factory wages & salaries

Finished good inventory

Raw Material inventory

Sales Revenue

Wages Payable

Work in process Inventory

Belle Factory uses a job-order costing system and applies factory overhead (FOH) to work-in-process inventory using a budgeted overhead rate. The activity base used by the factory is 'labour hours'. The factory does not use Overhead Applied and Under (Over) applied Overhead account. The applied overhead is credited to the Factory Overhead accounts before the actual overhead are incurred, and it is debited to Work in Process Inventory account. Any difference in the balances in the Factory overhead account will be closed off to Cost of Sales account directly. Note: The budgeted overhead rate is $14 per labour hour. The factory used 10,000 labour hours during the period. The inventory balances at the beginning of the period were $80,000 for raw materials, $90,000 for work in process and $100,000 for finished goods. Assume the opening balances of other extracted T-accounts were zero. The factory incurred the following transactions during a period: A. Raw materials purchased on accounts for $200,000. B. C. D. E. Raw materials assigned to the job#: $70,000 direct and $60,000 indirect. Factory payroll incurred, $110,000: General Labour costs are not included Factory labour costs assigned to the job#: $75,000 direct and $35,000 indirect Factory overhead assigned to production using a predetermined overhead Additional overhead costs were billed, $50,000 Jobs completed and transferred to finished goods at cost, $120,000. Jobs with a cost of $130,000 were sold on account for $200,000 Under/Over-applied overheads were closed off to the Cost of Sales account F. G. H. 1. Required; Ignore GST and Income Tax. A) Journalise the above transactions B) Prepare a schedule of cost of goods manufactured for the period C) Prepare a trading statement for the period A) Journalise the above transactions # Accounts Dr Cr A A Raw material purchased . B Raw materials requisitioned to job # A C Factory Labour incurred . D Labour costs assigned to job # E Factory overhead applied F Additional actual overhead incurred G - Completion of job # $200,000 A $200,000 H - Sale of Job # Under/over-applied overhead closed off B) Prepare a schedule of cost of goods manufactured for the period CHARLIE'S Factory Pty Ltd Schedule of Cost of Goods Sold For the accounting period Beginning Add: purchases of Cost of available for use Deduct: ending used Less: indirect materials used Direct materials used Direct manufacturing labour costs Indirect manufacturing costs (MOH) applied Manufacturing costs incurred during the period Add: beginning . Total manufacturing costs to account for . Deduct: ending Cost of goods manufactured C) Prepare a trading statement for the period CHARLIE'S Factory Pty Ltd Trading Statement For the accounting period Cost of Sales: Beginning Add: Cost of goods manufactured Cost of goods available for sale Deduct: Ending Unadjusted Add or Deduct: under/over-applied Adjusted cost of goods sold Gross margin