please help with #5-9
Post Company uses a normal job-order costing system in its only production department. Overhead is applied to jobs by a plant-wide overhead rate based on direct labor hours. The first year of operation began on December 1, 2021. During the month of December, Post purchased direct material with a total cost of $4,000. Of the $4,000, Post used $500 on Job 50 . Job 50 was the only job worked during the month of December. Post also charged $2,000 in conversion costs (direct labor and applied overhead) to Job 50 in December. JOB 50 WAS NOT FINISHED IN DECEMBER 2021. There was no overapplied or underapplied overhead for December. For the new year (1/1/2022-12/31/2022), Post had the following transactions occur. Remember to take into consideration the above information when setting up your problem. 1. Estimations for 2022 include $420,000 in overhead and 30,000 direct labor hours. 2. Direct materials purchased during 2022 cost a total of $84,000. 3. Direct materials were used on jobs during 2022 as follows: JOB 50$10.850 4. During 2022 there were 4,845 direct labor hours used on Job 50;6,900 direct labor hours used on Job 51;9,750 direct labor hours on Job 52; 5,850 direct labor hours on Job 53 and 2,916 direct labor hours on Job 54. The direct labor hours used during 2022 had a rate of $15.00 per hour. (CAREFUL WITH CALCULATIONS!) 6. By December 31,2022 , Jobs 50 and 51 were completed. Job 50 consisted of 5,936 and Job 51 consisted of 21,250 units. 7. All of Job 51 was sold during 2022 for $44 per unit. In addition, Post sold 5,000 of the 5,936 units for $80 per unit. 5. Add together the total cost charged to Jobs 50 and 51 . Does this answer equal the amount of Cost of Goods Manufactured that you got in \#4? Should it? 6. Compute the underapplied or overapplied overhead for 2022. 7. Prepare, in good form, an income statement for 2022 . Close your Under/Overapplied OH by using our "Method 1". 8. Now assume that you are to allocate (prorate) the underapplied or overapplied overhead to the appropriate accounts. You should be able to figure out how much applied overhead is in Work in Process (what jobs are not complete?). You can assume that there is $10,695 of applied overhead in Finished Goods. Based on the total applied overhead for the year, you should be able to figure out how much applied overhead should be in Cost of Goods Sold. Do the proration and SHOW YOUR CALCULATIONS! 9. If you were to prepare a new income statement after prorating underapplied or overapplied overhead, would income be higher or lower than what you got in \#7? By how much? IF YOU DON'T KNOW WHAT IS MEANT BY A FINANCIAL STATEMENT IN GOOD FORM-ASK! YOUR TASKS: 1. Compute the ending balance in Materials Inventory and Work in Process Inventory as of December 31, 2021. (Please note the Year!) 2. Without preparing a schedule or preparing any computations, what is the Cost of Goods Manufactured for December 31, 2021? (You should be able to do this in your head!) 3. Compute the Predetermined Overhead Rate for 2022. 4. Prepare, in good form, a fully complete Schedule of Cost of Goods Manufactured for 2022 . 5. Add together the total cost charged to Jobs 50 and 51 . Does this answer equal the amount of Cost of Goods Manufactured that you got in \#4? Should it? 6. Compute the underapplied or overapplied overhead for 2022. 7. Prepare, in good form, an income statement for 2022. Close your Under/Overapplied OH by using our "Method 1". 8. Now assume that you are to allocate (prorate) the underapplied or overapplied overhead to the appropriate accounts. You should be able to figure out how much applied overhead is in Work in Process (what jobs are not complete?). You can assume that there is $10,695 of applied overhead in Finished Goods. Based on the total applied overhead for the year, you should be able to figure out how much applied overhead should be in Cost of Goods Sold. Do the proration and SHOW YOUR CALCULATIONS! 9. If you were to prepare a new income statement after prorating underapplied or overapplied overhead, would income be higher or lower than what you got in \#7? By how much? IF YOU DON'T KNOW WHAT IS MEANT BY A FINANCIAL STATEMENT IN GOOD FORM-ASK
