Ravin does hand$-$crafted memorabilia for the tourism industry, in which each batch of items is a job. The

company has a highly machine intensive production process, so it allocates manufacturing overhead

based on machine hours. Ravin pre$-$determined overhead application rate for $2023$ was computed

from the following data:

Total estimated factory overheads $$2,400,000$

Total estimated machine hours $40,000$

At the end of May $2023,$ Ravin reported work in process inventory of $$176,000.$

During June $2023,$ Ravin actually used $3,000$ machine hours and recorded the following transactions.

i$)$ Purchased $$324,000$ worth of materials on account. Separately, Ravin paid a $$2,500$ bill for

freight$-$in

ii$)$ Manufacturing wages incurred $-$ $$400,000$

iii$)$ Materials requisition $($includes $$30,000)$ of indirect materials$)-$ $$420,000$

iv$)$ Assigned manufacturing wages, $85\%$ direct labor, $15\%$ indirect labor

v$)$ Depreciation expense on factory equipment used on the different jobs $-$ $$95,000$

vi$)$ Other manufacturing overhead incurred $-$ $$35,000$

vii$)$ Allocated manufacturing overhead for June $2023$

viii$)$ Cost of jobs completed $-$ $$1,015,000.$

ix$)$ Cost of jobs sold $($on account$)$ at a margin of $33\frac{1}{3}\%$ on sales $-$$$985,000.$

Required:

a$.$ Compute Ravin's predetermined manufacturing overhead rate for $2023.$

b$.$ State the journal entries necessary to record the above transactions in the general journal. Assume that

Ravin uses the perpetual inventory system.

c$.$ Post the manufacturing overhead transactions to the Manufacturing Overhead T$-$account and state the

balance on the account before performing end of period closing entries. Show the journal entries

necessary to dispose of the variance.

d$.$ What is the balance in the Cost of Goods Sold account after the adjustment?

e$.$ Compute Ravin's gross profit earned on the jobs completed and sold, after adjusting for the

manufacturing overhead variance.

f$.$ Post the appropriate entries to Work in Process Inventory Control account & determine the account

balance on June $30,$ the end of the month.

g$.$ State and explain three $(3)$ differences between a job costing system and a process costing system