Problem 4-32 (Part Level Submission) Bonita Wings, Inc. manufactures airplanes for use in stunt shows. Bonitas factory is highly automated, using the latest in robotic technology. To keep costs low, the company employs as few factory workers as possible. Since each plane has different features (such as its shape, weight, and color), Bonita uses a job order costing system to accumulate product costs. At the end of 2016, Bonitas accountants developed the following expectations for 2017 based on the marketing departments sales forecast: Budgeted overhead cost $1,075,000 Estimated machine hours 49,000 Estimated direct labor hours 9,000 Estimated direct materials cost $1,510,000 Bonitas inventory count, completed on December 31, 2016, revealed the following ending inventory balances: Raw Materials Inventory $251,000 Work in Process Inventory $625,000 Finished Goods Inventory $2,080,000 The companys 2017 payroll data revealed the following actual payroll costs for the year: Job Title Number Employed Wage Rate per Hour Annual Salary per Employee Total Hours Worked per Employee President and CEO 1 $224,000 Vice president and CFO 1 $177,000 Factory manager 1 $40,300 Assistant factory manager 1 $31,400 Machine operator 5 $14.5 2,250 Security guard, factory 2 $20,400 Forklift operator 2 $7.5 2,000 Corporate secretary 1 $35,700 Janitor, factory 2 $6 2,150 The following information was taken from Bonitas Schedule of Plant Assets. All assets are depreciated using the straight-line method. Plant Asset Purchase Price Salvage Value Useful Life Factory building $4,000,000 $150,000 20 Years Administrative office $650,000 $125,000 30 Years Factory equipment $2,000,000 $20,000 12 Years Other miscellaneous costs for 2017 all paid in cash included: Cost Amount Factory insurance (fully expired) $12,300 Administrative office utilities $5,400 Factory utilities $30,100 Office supplies (fully consumed) $4,100 Additional information about Bonitas operations in 2017 includes the following: Raw materials purchases for the year amounted to $1,945,000. All materials were purchased on account. The company used $1,860,000 in raw materials during the year. Of that amount, 85% was direct materials and 15% was indirect materials. Bonita applied overhead to Work in Process Inventory based on direct materials cost. Airplanes costing $3,450,000 to manufacture were completed and transferred out of Work in Process Inventory. Bonita uses a markup of 80% to price its airplanes. Sales for the year were $6,570,000. All sales are made on account. (Note: This transaction requires two journal entries.) Collapse question part (a) Correct answer. Your answer is correct. What was Bonitas predetermined overhead rate in 2017? (Round answer to 2 decimal places, e.g. 52.75%.) Predetermined overhead rate Entry field with correct answer 71.19 % of direct materials cost Click if you would like to Show Work for this question: Open Show Work SHOW LIST OF ACCOUNTS SHOW SOLUTION LINK TO TEXT LINK TO TEXT LINK TO TEXT LINK TO TEXT LINK TO VIDEO LINK TO VIDEO Attempts: 1 of 2 used Collapse question part (b) Partially correct answer. Your answer is partially correct. Try again. Prepare the journal entries to record Bonitas costs for 2017. (Use Salaries Payable and Wages Payable accounts for payroll costs.) (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Post entries in order presented in the problem. Round answers to 0 decimal places, e.g. 5,275.) No. Account Titles and Explanation Debit Credit 1. Entry field with correct answer Salaries and Wages Expense Entry field with correct answer 436700 Entry field with correct answer Entry field with correct answer Salaries Payable Entry field with correct answer Entry field with correct answer 436700 (To record salaries for president, vice president, and corpoarte secretary) 2. Entry field with incorrect answer Salaries and Wages Expense Entry field with incorrect answer 92100 Entry field with correct answer Entry field with correct answer Salaries Payable Entry field with correct answer Entry field with incorrect answer 92100 (To record salaried factory worker costs) 3. Entry field with correct answer Work in Process Inventory Entry field with incorrect answer 1581000 Entry field with correct answer Entry field with correct answer Manufacturing Overhead Entry field with incorrect answer 279000 Entry field with correct answer Entry field with incorrect answer Raw Materials Inventory Entry field with correct answer Entry field with incorrect answer 1860000 (To record hourly factory worker costs) 4. Entry field with incorrect answer Operating Expenses Entry field with correct answer 17500 Entry field with correct answer Entry field with correct answer Accumulated Depreciation Entry field with correct answer Entry field with correct answer 17500 (To record depreciation on administrative office equipment) 5. Entry field with incorrect answer Work in Process Inventory Entry field with incorrect answer 60525 Entry field with correct answer Entry field with incorrect answer Raw Materials Inventory Entry field with correct answer Entry field with incorrect answer 60525 (To record depreciation on factory building and equipment) 6. Entry field with incorrect answer Entry field with incorrect answer 9500 Entry field with correct answer Entry field with correct answer Office Supplies Entry field with incorrect answer Entry field with incorrect answer 4100 Entry field with incorrect answer Accounts Payable Entry field with correct answer Entry field with incorrect answer 5400 (To record administrative office utilities and office supplies expense) 7. Entry field with incorrect answer Office Supplies Entry field with incorrect answer 17500 Entry field with correct answer Entry field with incorrect answer Accumulated Depreciation Entry field with correct answer Entry field with incorrect answer 17500 (To record factory insurance and factory utilities) 8. Entry field with correct answer Raw Materials Inventory Entry field with correct answer 1945000 Entry field with correct answer Entry field with correct answer Accounts Payable Entry field with correct answer Entry field with correct answer 1945000 (To record raw materials purchases) 9. Entry field with correct answer Manufacturing Overhead Entry field with incorrect answer 42400 Entry field with correct answer Entry field with incorrect answer Entry field with incorrect answer Entry field with incorrect answer 12300 Entry field with incorrect answer Accounts Payable Entry field with correct answer Entry field with incorrect answer 30100 (To record direct materials and indirect materials used in production) 10. Entry field with correct answer Work in Process Inventory Entry field with correct answer 1125514 Entry field with correct answer Entry field with incorrect answer Entry field with correct answer Entry field with correct answer 1125514 (To apply overhead to work in process) 11. Entry field with correct answer Finished Goods Inventory Entry field with correct answer 3450000 Entry field with correct answer Entry field with correct answer Work in Process Inventory Entry field with correct answer Entry field with correct answer 3450000 (To record transfer of completed airplanes) 12. Entry field with correct answer Accounts Receivable Entry field with correct answer 6570000 Entry field with correct answer Entry field with incorrect answer Accounts Payable Entry field with correct answer Entry field with correct answer 6570000 (To record sale of airplanes to customers) 13. Entry field with correct answer Cost of Goods Sold Entry field with correct answer 3650000 Entry field with correct answer Entry field with correct answer Finished Goods Inventory Entry field with correct answer Entry field with correct answer 3650000 (To record cost of airplanes sold) Click if you would like to Show Work for this question: Open Show Work SHOW LIST OF ACCOUNTS SHOW SOLUTION LINK TO TEXT LINK TO TEXT LINK TO TEXT LINK TO TEXT LINK TO VIDEO LINK TO VIDEO Attempts: 2 of 2 used Collapse question part (c) Prepare the appropriate T-accounts for Raw Materials Inventory, Work-in-Process Inventory, Finished Goods Inventory, Manufacturing Overhead Control, Cost of Goods Sold, and Sales, and record Bonitas transactions for 2017. (Post entries in order presented in the problem. Round answers to 0 decimal places, e.g. 5,275.) Raw Materials Work in Process Inventory Finished Goods Inventory Manufacturing Overhead Cost of Goods Sold Sales Revenue Click if you would like to Show Work for this question: Open Show Work LINK TO TEXT LINK TO TEXT LINK TO TEXT LINK TO TEXT LINK TO VIDEO LINK TO VIDEO Attempts: 0 of 2 used SAVE FOR LATER SUBMIT ANSWER Expand question part (d)