135 PROBLEM FOR SELF-STUDY PROBLEM FOR SELF-STUDY Your manager asks you to bring the following incomplete accounts of Endeavor Printing, Inc.. up to date through January 31, 2017. Consider the data that appear in the Taccounts as well as the following information in items (a) through (i). Endeavor's normal-costing system has two direct-cost categories direct material cows and direct manufacturing labor costs) and one indirect.cost pool manufacturing overhead costs. which are allocated using direct manufacturing labor costs). Materials Control Wages Payable Control 12-31-2018 Bal 30,000 1-31-2017 Bal ,000 Werk-in-Process Control Manufacturing Overhead Control 1-31-2017 Bat. 114.000 Casts of Goods Sold Finished Goods Control 12-31-2016 Bal 40,000 Additional information follows: a. Manufacturing owerhead is allocated using a budgeted rate that is set every December You forecast next year's manufacturing overhead costs and next year's direct manufactur- ing labor costs. The budget for 2017 is $1.200,000 for manufacturing overhead costs and S800,000 for direct manufacturing labor costs. b. The only job unfinished on January 31, 2017, is No. 419, on which direct manufacturing labor costs are $4.000 (250 direct manufacturing labor hours) and direct material costs are 516,000 c. Total direct materials issued to production during January 2017 are $180,000. d. Cost of goods completed during January is $360,000. e. Materials inventory as of January 31, 2017, is $40,000. f. Finished-goods inventory as of January 31, 2017, is $30,000. & All plant workers earn the same wage rate. Direct manufacturing labor-hours used for January total 5,000 hours. Other labor costs total $20,000. h. The gross plant payroll paid in January equals $104,000. Ignore withholdings. 1. All actual manufacturing overhead cost incurred during January has already been posted. j. All materials are direct materials. Calculate the following 1. Materials purchased during January 2. Cost of Goods Sold during January 3. Direct manufacturing labor costs incurred during January 4. Manufacturing Overhead Allocated during January 5. Balance, Wages Payable Control, December 31, 2016 6. Balance, Work-in-Process Control, January 31, 2017 7. Balance, Work-in-Process Control, December 31, 2016 8. Manufacturing Overhead Underallocated or Overallocated for January 2017 Solution Amounts from the T-accounts are labeled "(T)." 1. From Materials Control T-account, Materials purchased: $180,000 (c) + $40,000 (e) - $30,000 (T) = $190,000 2. From Finished Goods Control T-account, Cost of Goods Sold: $40,000 (T) + $360,000 (d) - $30,000 (f) = $370,000 CHAPTERO COSTA (b) - Sto d manufacturing labor a te 4.000 (b) direst u ring labor hours acturing labor hour(s) x 516 Manufacturing overhead Maturing S1000 Alle S BD () - 150 ( 3) - 1-50SSOURO From Payable Conte m ber 5104,000 (h) - 56000 (T) - S 0 ( 3) 5 (5) - SI Control, 11 1 $4.000 (b) = 5 .000 ( h i d e 7.) 7. From Work in Process Control T o December 31, 20 2.0 ( 6) - SID - 3 - 1 - $6.000 & Manufacturing overhead overallocated 20 4 1-511000 (T) - 5.000 Lentes alongside entries in T-accounts correspond to the preceding addicional formation Numbers alongside entries in Ta o r m ers in the proced requirements December 31, 2018, BN Bu v eni Materials Control 30.000 el 180,000 Work in Process Control 07 .000 fel 100.000 Id) 350,000 December 31, 2016. Sal Direct materials Direct manufacturing labor Manufacturing overhead allocated January 31, 2017, Bal 4 120.000 December 31, 2018, Bal v January 31, 2017, Bal 12) 370,000 Finished Goods Control e 000 Idi 30 000 M 30.000 Wages Payable Control IN 104.000 December 31, 2016, Bal 15 Il gl given 10,000 80.000 20.000 5.000 Total January charges January 31, 2017 Manufacturing Overhead Control Igiveni 114.000 Manufacturing Overhead Allocated (3) lal (4) 120.000 Id 102) Cost of Goods Sold 370.000 C " r ocherpihen made 38 CHAPTER 4 JOB COSTING 3. Direct manufacturing wage rate: $4.000 (h) 150 direct facturing labor hours (b) = $16 per direct manufacturing Lahor hour Direct manufacturing labor cost 5.000 munufaturing Labor-hour ) X 516 per direct manufacturing labor-hour 50.000 4. Manufacturing overhead rate: $1.200.000 (a) 500.000 (a) = 150% Manufacturing Overhead Allocated: 150% of $20.000 (see) = 1.50 X 580,000 $120,000 3. From Wages Payable Control Taccount. Was Povable Control, December 31, 2016 S104.000 (h) + $6,000 (T) - 580,000 (see 3) - $20.000 () = $10.000 6. Work-in-Process Control, January 31, 2017: $16.000 (b) + 54.000 (b) + 150% of $4.000 (b) = $26.000 This answer is used in m 7.) 7. From Work-in-Process Control T-account. Work in Process Control, December 31, 2016 $360,000 (d) + $26.000 (see 6) - S180.000 (s) - $80,000 ( 3) - $120.000 ( 4) $6,000 8. Manufacturing overhead overallocated: $120,000 (see 4) - 5114.000 (T) = 56.000. Letters alongside entries in T-accounts correspond to lasters in the preceding additional in- formation. Numbers alongside entries in T-accounts correspond to numbers in the preceding requirements. December 31, 2016, Bal Icl 180.000 January 31, 2017, Bal Materials Control given) 30.000 (1) 190.000 lel 40.000 Work-in-Process Control 7 6 .000 (c) 10.000 (bilo 13180000 (31 (al (4) 120,000 Id) 350.000 December 31, 2016, Bal Direct materials Direct manufacturing labor Manufacturing overhead allocated January 31, 2017, Bal December 31, 2016. Bal. (2) 370.000 (bl (5) 25,000 Finished Goods Control iveni 40.000 Idl360,000 30,000 Wages Payable Control th) 104,000 December 31, 2016, Bal. January 31, 2017 Bal 15 Ig) (3) lgi Igiven 10.000 80,000 20.000 6.000 January 31, 2017 Manufacturing Overhead Control (giveni 114,000 Manufacturing Overhead Allocated Total January charges (31 (a) (4) 120.000 Cost of Goods Sold 370,000 Idl (21 135 PROBLEM FOR SELF-STUDY PROBLEM FOR SELF-STUDY Your manager asks you to bring the following incomplete accounts of Endeavor Printing, Inc.. up to date through January 31, 2017. Consider the data that appear in the Taccounts as well as the following information in items (a) through (i). Endeavor's normal-costing system has two direct-cost categories direct material cows and direct manufacturing labor costs) and one indirect.cost pool manufacturing overhead costs. which are allocated using direct manufacturing labor costs). Materials Control Wages Payable Control 12-31-2018 Bal 30,000 1-31-2017 Bal ,000 Werk-in-Process Control Manufacturing Overhead Control 1-31-2017 Bat. 114.000 Casts of Goods Sold Finished Goods Control 12-31-2016 Bal 40,000 Additional information follows: a. Manufacturing owerhead is allocated using a budgeted rate that is set every December You forecast next year's manufacturing overhead costs and next year's direct manufactur- ing labor costs. The budget for 2017 is $1.200,000 for manufacturing overhead costs and S800,000 for direct manufacturing labor costs. b. The only job unfinished on January 31, 2017, is No. 419, on which direct manufacturing labor costs are $4.000 (250 direct manufacturing labor hours) and direct material costs are 516,000 c. Total direct materials issued to production during January 2017 are $180,000. d. Cost of goods completed during January is $360,000. e. Materials inventory as of January 31, 2017, is $40,000. f. Finished-goods inventory as of January 31, 2017, is $30,000. & All plant workers earn the same wage rate. Direct manufacturing labor-hours used for January total 5,000 hours. Other labor costs total $20,000. h. The gross plant payroll paid in January equals $104,000. Ignore withholdings. 1. All actual manufacturing overhead cost incurred during January has already been posted. j. All materials are direct materials. Calculate the following 1. Materials purchased during January 2. Cost of Goods Sold during January 3. Direct manufacturing labor costs incurred during January 4. Manufacturing Overhead Allocated during January 5. Balance, Wages Payable Control, December 31, 2016 6. Balance, Work-in-Process Control, January 31, 2017 7. Balance, Work-in-Process Control, December 31, 2016 8. Manufacturing Overhead Underallocated or Overallocated for January 2017 Solution Amounts from the T-accounts are labeled "(T)." 1. From Materials Control T-account, Materials purchased: $180,000 (c) + $40,000 (e) - $30,000 (T) = $190,000 2. From Finished Goods Control T-account, Cost of Goods Sold: $40,000 (T) + $360,000 (d) - $30,000 (f) = $370,000 CHAPTERO COSTA (b) - Sto d manufacturing labor a te 4.000 (b) direst u ring labor hours acturing labor hour(s) x 516 Manufacturing overhead Maturing S1000 Alle S BD () - 150 ( 3) - 1-50SSOURO From Payable Conte m ber 5104,000 (h) - 56000 (T) - S 0 ( 3) 5 (5) - SI Control, 11 1 $4.000 (b) = 5 .000 ( h i d e 7.) 7. From Work in Process Control T o December 31, 20 2.0 ( 6) - SID - 3 - 1 - $6.000 & Manufacturing overhead overallocated 20 4 1-511000 (T) - 5.000 Lentes alongside entries in T-accounts correspond to the preceding addicional formation Numbers alongside entries in Ta o r m ers in the proced requirements December 31, 2018, BN Bu v eni Materials Control 30.000 el 180,000 Work in Process Control 07 .000 fel 100.000 Id) 350,000 December 31, 2016. Sal Direct materials Direct manufacturing labor Manufacturing overhead allocated January 31, 2017, Bal 4 120.000 December 31, 2018, Bal v January 31, 2017, Bal 12) 370,000 Finished Goods Control e 000 Idi 30 000 M 30.000 Wages Payable Control IN 104.000 December 31, 2016, Bal 15 Il gl given 10,000 80.000 20.000 5.000 Total January charges January 31, 2017 Manufacturing Overhead Control Igiveni 114.000 Manufacturing Overhead Allocated (3) lal (4) 120.000 Id 102) Cost of Goods Sold 370.000 C " r ocherpihen made 38 CHAPTER 4 JOB COSTING 3. Direct manufacturing wage rate: $4.000 (h) 150 direct facturing labor hours (b) = $16 per direct manufacturing Lahor hour Direct manufacturing labor cost 5.000 munufaturing Labor-hour ) X 516 per direct manufacturing labor-hour 50.000 4. Manufacturing overhead rate: $1.200.000 (a) 500.000 (a) = 150% Manufacturing Overhead Allocated: 150% of $20.000 (see) = 1.50 X 580,000 $120,000 3. From Wages Payable Control Taccount. Was Povable Control, December 31, 2016 S104.000 (h) + $6,000 (T) - 580,000 (see 3) - $20.000 () = $10.000 6. Work-in-Process Control, January 31, 2017: $16.000 (b) + 54.000 (b) + 150% of $4.000 (b) = $26.000 This answer is used in m 7.) 7. From Work-in-Process Control T-account. Work in Process Control, December 31, 2016 $360,000 (d) + $26.000 (see 6) - S180.000 (s) - $80,000 ( 3) - $120.000 ( 4) $6,000 8. Manufacturing overhead overallocated: $120,000 (see 4) - 5114.000 (T) = 56.000. Letters alongside entries in T-accounts correspond to lasters in the preceding additional in- formation. Numbers alongside entries in T-accounts correspond to numbers in the preceding requirements. December 31, 2016, Bal Icl 180.000 January 31, 2017, Bal Materials Control given) 30.000 (1) 190.000 lel 40.000 Work-in-Process Control 7 6 .000 (c) 10.000 (bilo 13180000 (31 (al (4) 120,000 Id) 350.000 December 31, 2016, Bal Direct materials Direct manufacturing labor Manufacturing overhead allocated January 31, 2017, Bal December 31, 2016. Bal. (2) 370.000 (bl (5) 25,000 Finished Goods Control iveni 40.000 Idl360,000 30,000 Wages Payable Control th) 104,000 December 31, 2016, Bal. January 31, 2017 Bal 15 Ig) (3) lgi Igiven 10.000 80,000 20.000 6.000 January 31, 2017 Manufacturing Overhead Control (giveni 114,000 Manufacturing Overhead Allocated Total January charges (31 (a) (4) 120.000 Cost of Goods Sold 370,000 Idl (21
