Question 1

	Sampson Company uses a job order cost system with overhead applied based on direct labor hours.See estimated amounts below. Note the beginning balances for Finished Goods (Job 101) and Work-in-Process (Jobs 102 & 103) for the costs accumulated to date. Also note, the beginning balances in the other balance sheet accounts.
	Estimated Overhead for 2018	720,000
	Estimated Direct Labor Hours for 2014	24,000
	During January the company had the following transactions:
	(a)	Purchased raw materials on account in the amount of:	10,000
	(b)	Issued the following materials into production:
			Amount	Explanation
		Direct materials	7,000	Job 102	2,000
				Job 103	5,000
		Indirect materials	2,000	Used on both jobs.
		Total	9,000
	(c)	Recorded salaries and wages as follows:
			Amount	Explanation
		Direct labor	10,000	Job 102	6,000
				Job 103	4,000
		Indirect labor	4,000	For factory supervision
		Salaries	5,000	For administrative staff
		Total	19,000
	(d)	Applied overhead to jobs based on the number of direct labor hours required
		Job Number	Direct labor hours
		Job 102	300
		Job 103	200
		Total	500
	(e)	Recorded the following actual manufacturing costs:
			Amount	Explanation
		Rent	6,000	Paid factory rent in cash
		Depreciation	5,000	Factory equipment
		Insurance	3,000	Had one month of factory insurance policy expire
		Utilities	2,000	Received factory utility bill but did not pay it.
		Total	16,000
	(f)	Recorded the following general and administrative costs:
			Amount	Explanation
		Advertising	2,000	Advertising paid in cash
		Depreciation	3,000	Office equipment
		Other expenses	1,000	Miscellaneous expense incurred but not paid.
		Total	6,000
	(g)	Sold Job 101, which is recorded in Finished Goods:
		Sales Price	55,000
		Cost	30,000
	(h)	Completed Job 102 but did not sell it; Job 103 is still in process at year-end.
Required:
1	Compute the predetermined overhead rate.
	Predetermined overhead rate
2	Compute how much overhead would be applied to jobs during the period:
	Overhead applied
3	Compute the total cost of Jobs 102 and 103 at the end of the period. You will enter your calculation in the 'Ledger Accounts' tab of this workbook.
	Where will the cost of each of these jobs appear on the Balance sheet?
4	Post the journal entries to the 'T' Accounts in the 'Ledger Accounts' tab. Calculate the ending balances in all of the accounts.
5	Calculate the amount of over- or underapplied overhead in the 'Ledger Accounts' tab.
6	Post the journal entry in the T accounts to dispose of the overhead balance in the 'Ledger Accounts' tab.
7	Prepare statement of cost of goods manufactured report in the 'Reports' tab.
8	Prepare income statement in the 'Reports' tab.
9	Prepare basic balance sheet in the 'Reports' tab.

Question 2

Raw Materials Inventory		Manufacturing Overhead
1/1/18 (Beg)	10,000
Work in Process Inventory			Job Sheet: 102	Job Sheet: 103
1/1/18 (Beg)	15,000				1/1/18 (Beg)	15,000	0
Finished Goods		Cost of Goods Sold
1/1/18 (Beg)	30,000
Sales Revenue		Selling, General, and Administrative Expenses
Cash and Other Assets		Payables and Other Liabilities
1/1/18 (Beg)	100,000						85,000	1/1/18 (Beg)
Stockholders' Equity
		70,000	1/1/18 (Beg)

Question 3

7	Sampson Company
	Cost of Goods Manufactured Report
	For the Month of January
	Beginning Raw Materials Inventory
	Plus: Raw Material Purchases
	Less: Indirect Material Used
	Less: Ending Raw Materials Inventory
	Direct Materials Used in Production
	Direct Labor
	Manufacturing Overhead
	Total Current Manufacturing Costs
	Plus: Beginning Work in Process Inventory
	Total Work in Process
	Less: Ending Work in Process Inventory
	Cost of Goods Manufactured*
8	Sampson Company
	Income Statement
	For the Month of January
	Sales Revenue
	Less: Cost of Goods Sold
	Beginning Finished Goods Inventory
	Plus: Cost of Goods Manufactured* (see schedule above)
	Cost of Goods Available for Sale
	Less: Ending Finished Goods Inventory
	Unadjusted Cost of Goods Sold
	Under-/Overapplied Overhead
	Adjusted Cost of Goods Sold
	Gross Profit
	Less: Operating (Period) Expenses
	Net Income from Operations
9	Sampson Company
	Balance Sheet
	As of January 31st
	Assets				Liabilities
	Cash and Other Assets				Payables and Other Liabilities
	Raw Materials Inventory
	Work in Process Inventory
	Finished Goods Inventory				Stockholders' Equity
	Total Assets