Question 3 Job Costing

On March 1, Pixma Company had the following balances in its inventory accounts:

Raw Materials $42,000

Work in Process $ 9,905

Finished Goods $ 0

Work in Process of $9,905 on March 1 was made up of three jobs with the following costs:

	Job 817	Job 818	Job 819
Raw materials	$2,100	$1,410	$1,915
Direct labour	900	850	1,050
Applied overhead	540	510	630

Hint: Add these to get your beginning WIP amounts for March.

During March, the following transactions occurred:

Materials purchased on account: $15,000

Materials used: Job 817: $8,500; Job 818: $7,200; Job 819: $12,300.

and $40 materials used indirectly

Labor hours used on jobs: Job 817: 185 hours at $10 per hour; Job 818: 175 hours at $11 per hour; Job 819: 235 hours at $10 per hour.

and $60 labor used indirectly

Overhead is applied on the basis of direct labour cost.

[Hint: Look at the overhead applied to Jobs 817-819 to determine the overhead rate.]

Actual other overhead spent: $3,500 (assume cash)

Jobs 817 and 818 were completed and transferred to the finished goods warehouse.

Job 818 was shipped, and the customer was billed for 160 percent of the cost.

Close overhead to Cost of Goods Sold (no pro-rating).

Required:

Prepare the journal entries for transactions (a) through (h).

Use the following page.

Prepare job-order cost sheets for Jobs 817, 818, and 819. Post the beginning inventory data, and then update the cost sheets for the March activity.

Calculate the March 31 balances for the three inventory accounts.