Question 4 and 5 on the page and spreadsheet. I cannot determine the general journal and income statement correctly. What is the correct manufacturing overhead and cost of goods sold?
5 BJ MVWLTNWSQ ate OO why fa Wb'h b. Raw materials we = c. The following costs v ihect for JOb 203, which was started and completed during the year, shows the following: Department oxlv'xvvk 7/10 . Cutting Finishing cg Dlrect labor-hours ............................... 6 20 Machine-hours .................................... 80 4 Materials requisitioned ....................... $500 $310 $70 $150 Direct labor cost .................................. Compute the total overhead cost applied to Job 203. 3' Would You expect substantially different amountshof overhead cost to be assigned to some JObs if the company used a plantwide overhead rate based on direct labor cost, rather than "Slng departmental rates? Explain. No computations are necessary. so Problem 03-16 -- Activit atement 25 oints -Based Costin0 Cost Flows and Income St based costing for its external Aucton Corporation is a manufacturing company that uses activity- for the coming year financial reports. The company's activity cost pools and associated data appear below: Activity Estimated Expected Activity Cost Pool Measure Overhead Cost Activity Machining ...................... Machine-hours $180,000 1.000 MHs Purchase orders .............. Number of orders $90,000 600 orders Parts management .......... Number of part types $60,000 300 part types Testing ........................... Number of tests $150,000 250 tests General factory .............. Direct labor-hours $280,000 20,000 DLHs At the beginning of the year, the company had inventory balances as follows: ' 0 Raw materials ...................................... $7,000 Work in process ................................... $6,000 $10,000 Finished goods ..................................... The following transactions were recorded for the year: Raw materials were purchased on account, $595,000 . storeroom for use in production, $600,000 d $40,000 indirect . u v" - incurred for employee services: direct labor, $90,000; indirect labor, $300,000; sales commissions, $85,000; and administrative salaries, $245,0'00. ($560,000 direct . 657-6-3Sales travel costs were incurred, $38,000. ' Various factory overhead costs were incurred, $237,000. d e f. Advertising costs were incurred, $l90,000. on5 g ti t opera Depreciation was recorded for the year, $270,000 ($210,000 related tO fac Cry and $60,000 related to selling and administrative activities). as as he year W h. Manufacturing overhead was applied to products. Actual activity for t / follows: Activity Cost Pool ACtual ACtiVity v8 0' 000 Machining ........................................ 1,050 MHS , 7 un up Purchase orders ................................ 580 orders (ia-gm Parts management ............................ 330 Part types 6' Mb Testing .............................................. 265 teSts '5 03 General factory ................................. 21,000 DLHS chqb ' r to the Goods were completed and transferred to the finished goods warehouse. According> . 000 to company's activity-based costing system, these finished gOOds cost $1,450, manufacture. . . OO. J. Goods were sold on account to customers during the year for a total of $2,100ao According to the company's activity-based costing system, the goods cost $1,400,000 to manufacture. Required: ewmm ('(bg/ MM 1. Compute the predetermined overhead rate (i.e., activity rate) for each activity cost pOOl. Prepare journal entries to record transactions (a) through (i) above. 2. 3. Post the entries in part (2) above to T-accounts. 4. Compute the underapplied or overapplied manufacturin entry to close any balance in the Manufacturin Post the entry to the appropriate T-accounts. 5. Prepare an income statement for the year. g overhead cost. Prepare a journal g Overhead account to Cost of Goods Sold. MO 005 U Q '3 X Od) OM @ W W '237OUU /'7 /X (VREJ'U' File Home Insert Page Layout Formul Review View AKCROB T agcm "Arial vllo vi A A' i Paste r P l n U , ' , V . "- I up 1- fi) 4'. A - 1 'ai-m 'H.' "j i 'j '3 v x H 'r ' "ig'meat Palmer ' > I x 1 "Jr ergpo Ccnm BUCHPbDBfid " ' ri 3. ' ' ' u ' I"; m Alignment ' ' j ' Nl ' 1 '5795300' V (EBBLO W "1fo
