Problem 15-1A Lott Company uses a job order cost system and applies overhead to production on the basis of direct labor costs. On January 1, 2017, Job No. 50 was the only job in process. The costs incurred prior to January 1 on this job were as follows: direct materials $24,500, direct labor $14,760, and manufacturing overhead $19,680. As of January 1, Job No. 49 had been completed at a cost of $110,700 and was part of finished goods inventory. There was a $18,450 balance in the Raw Materials Inventory account. During the month of January, Lott Company began production on Jobs 51 and 52, and completed Jobs 50 and 51. Jobs 49 and 50 were also sold on account during the month for $150,060 and $194,340, respectively. The following additional events occurred during the month. 1. Purchased additional raw materials of $110,700 on account. 2. Incurred factory labor costs of $86,100. Of this amount $19,680 related to employer payroll taxes. 3. Incurred manufacturing overhead costs as follows: indirect materials $20,910; indirect labor $24,600; depreciation expense on equipment $14,760; and various other manufacturing overhead costs on account $19,680. 4. Assigned direct materials and direct labor to jobs as follows. Job No. 50 51 52 Direct Materials $12,300 47,970 36,900 Direct Labor $6,150 30,750 24,600 Your answer has been saved and sent for grading. Calculate the predetermined overhead rate for 2017, assuming Lott Company estimates total manufacturing overhead costs of $1,033,200, direct labor costs of $861,000, and direct labor hours of 24,600 for the year. (Round answer to the nearest whole percent, e.g. 25%.) Predetermined overhead rate 1.2 SHOW LIST OF ACCOUNTS LINK TO TEXT LINK TO TEXT LINK TO TEXT LINK TO TEXT Job No. 50 Date Direct Materials Direct Labor Manufacturing Overhead Beg. $ 24600 $ 14760 $ 19680 Jan. 12300 6150 7380 12300 8610 27060 $ 12300 Cost of completed job Direct materials Direct labor Manufacturing overhead Total cost 8610 27060 47970 Job No. 51 Date Jan. Direct Materials Direct Labor Manufacturing Overhead 47970 30750 $ 36900 47970 30750 36900 Cost of completed job Direct materials 47970 Direct labor 30750 36900 Manufacturing overhead Total cost 115620 Job No. 52 Date Direct Materials Direct Labor Manufacturing Overhead Jan. $ 36900 24600 $ 29520 SHOW LIST OF ACCOUNTS LINK TO TEXT LINK TO TEXT LINK TO TEXT LINK TO TEXT Your answer has been saved and sent for grading. Prepare the journal entries to record the purchase of raw materials, the factory labor costs incurred, and the manufacturing overhead costs incurred during the month of January. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) No. Account Titles and Explanation Debit Credit (1) Raw Materials Inventory 110700 Accounts Payable 110700 (2) Factory Labor 86100 Employer Payroll Taxes 19680 Factory Wages Payable 66420 (3) Manufacturing Overhead Raw Materials Inventor 20910 Factory Labor 24600 Accumulated Depreciat 14760 Accounts Payable 19680 SHOW LIST OF ACCOUNTS LINK TO TEXT LINK TO TEXT LINK TO TEXT LINK TO TEXT Your answer has been saved and sent for grading. Prepare the journal entries to record the assignment of direct materials, direct labor, and manufacturing overhead costs to production. In assigning manufacturing overhead costs, use the overhead rate calculated in (a). (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Debit Credit No. Account Titles and Explanation (1) Work in Process Inventor 97170 97170 Raw Materials Inventor (2) Work in Process Inventor 61500 Factory Labor 61500 (3) Work in Process Inventor 73800 Manufacturing Overhea 73800 SHOW LIST OF ACCOUNTS LINK TO TEXT LINK TO TEXT LINK TO TEXT LINK TO TEXT Your answer has been saved and sent for grading. Total the job cost sheets for any job(s) completed during the month. Prepare the journal entry to record the completion of any job(s) during the month. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit Finished Goods Inventor Work in Process Inventor SHOW LIST OF ACCOUNTS LINK TO TEXT LINK TO TEXT LINK TO TEXT LINK TO TEXT 4 Your answer has been saved and sent for grading. Prepare the journal entries to record the sale of any job(s) during the month. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Debit Credit No. Account Titles and Explanation (1) Accounts Receivable 344400 344400 Sales Revenue (To record sale of jobs) (2) Cost of Goods Sold Finished Goods Inventory (To record cost of jobs) SHOW LIST OF ACCOUNTS LINK TO TEXT LINK TO TEXT LINK TO TEXT LINK TO TEXT Your answer has been saved and sent for grading. What is the balance in the Finished Goods Inventory account at the end of the month? What does this balance consist of? Finished Goods Inventory Jobs 50 and 51 SHOW LIST OF ACCOUNTS LINK TO TEXT LINK TO TEXT LINK TO TEXT LINK TO TEXT Your answer has been saved and sent for grading. What is the amount of over- or underapplied overhead? Manufacturing Overhead 5000 Underapplied SHOW LIST OF ACCOUNTS LINK TO TEXT LINK TO TEXT LINK TO TEXT LINK TO TEXT