RESULTS FOR THE REMAINDER OF THE YEAR

1. During February December 31, ALC Mountain Dew Lamp workers, requisitioned out 800 Mountain Dew Cans and 160 pieces of paper. Give the journal entry to describe this transaction.
2. During February December 31, ALC Coca-Cola Lamp workers requisitioned out 600 Coca-Cola cans and 300 pieces of paper. Give the journal entry.
3. During February December 31, ALC paid CASH the following to its workers:

Mountain Dew Lamp workers for direct labor (800 dlh * $10/dlh) $8,000

Coca-Cola Lamp workers (240 dlh * $25/dlh) $6,000

4. Give the journal entry to APPLY overhead from February December 31.
5. The Mountain Dew Lamp workers started and completed all 800 Mountain Dew Lamps from February December 31. The 800 Mountain Dew Lamps were transferred to finished goods. Give the journal entry to describe this transaction. Once again, create a job cost sheet for these 800 mountain Dew lamps.
6. Coca-cola Lamp workers started and completed all 600 Coca-Cola Lamps from February December 31. The 600 Coca-cola Lamps were transferred to finished goods. Give the journal entry to describe this transaction. Once again, create a job cost sheet for these 600 Coca-cola lamps.
7. During February December 31, ALC made 11 monthly depreciation journal entries totaling $1,100 for its lamp-making equipment. Give the journal entry.
8. During February December 31, ALC made 11 CASH payments for rent totaling $3,300. Give the journal entry.
9. During February December 31, ALC made 11 CASH payments for utilities totaling $1,200. These utilities pertain to the manufacturing plant. Please give the journal entry.
10. During February December 31, ALC sold 500 Mountain Dew Lamps for $50/lamp (or $25,000 total) in CASH. Give the journal entry to describe this transaction.
11. During February December 31, ALC sold 500 Coca-Cola Lamps for $100/lamp (or $50,000) in CASH. Give the journal entry to describe this transaction.
12. During the year, ALC paid CASH for the following PERIOD COSTS:

Salaries at corporate headquarters $20,000

Rent on corporate headquarters $20,000

13. Create your MOH clearing t-account. Here are some hints:
    1. Remember, the MOH clearing account will have a zero beginning balance.
    2. Your MOH clearing account will have ACTUAL January MOH on the debit side and APPLIED January MOH on the credit side. It will also have ACTUAL February December 31 MOH on the debit side and APPLIED February December 31 MOH on the credit side.

Is MOH OVER or UNDER-applied at 12/31? IF so, indicate by how much.

14. Please make the appropriate journal entry to close out any over/under-applied MOH to COGS at 12/31.
15. Using your prior journal entries create a 5-line income statement for 2020 (I DO NOT NEED A BALANCE SHEET). Your 5-line income statement should look like this:

Abbott Lamp Corporation manufactures BOTH Mountain Dew Lamps AND Coca-Cola Lamps, starts 1/1/20. On 1/1/20, Erin Rogers ESTIMATES the following MOH costs: Utilities for manufacturing building $4,000 Grease for machines $1,200 Rent on manufacturing building $3,600 Depreciation on manufacturing machine $1,200 $10,000 Erin Rogers also estimates a total of 2,000 direct labor hours for the year and ALC applies MOH costs using DLH (or direct labor hours). 1. Compute the Predetermined Overhead Rate. $10,000/2,000 dlh => $5/dlh 2. On 1/1/20, ALC obtains a lamp-making machine for $6000 on account. It has a O salvage value and a useful life of 5 years. Please give the journal entry to describe this transaction. PP&E Lamp Making Machine A/P $6,000 $6,000 3. On 1/1/20, ALC purchases - on account - 1000 Mountain Dew Cans for $10,000. It also purchases on account 2000 Coca-Cola Cans for $40,000 and 1,000 pounds of grease for $80,000. Please give the journal entry to record this transaction. RMI MDC $10,000 RMI CCC $40,000 RMI Grease $80,000 A/P $130,000 4. On 1/1/20, ALC purchases on account - 1,000 pieces of paper for $10,000. Please give the journal entry to describe this transaction. RMI Paper $10,000 AP $10,000 5. On 1/5/20, ALC mountain dew lamp workers requisitioned out 100 Mountain dew cans and 20 pieces of paper. Please give the journal entry to describe this transaction. WIP CCL $5,000 RMI CCC (200cans @ $20/can) $4,000 RMI Paper (100 pieces @$10/piece) $1,000 6. On 1/5/20, ALC coca-cola lamp workers requisitioned out 200 coca-cola cans and 100 pieces of paper. Please give the journal entry to describe this transaction. WIP CCL $5,000 RMI CCC (200cans @ $20/can) $4,000 RMI Paper (100 pieces @$10/piece) $1,000 7. On 1/15/20, ALC mountain dew lamp workers requisitioned out 10 pounds of grease (and remember, the grease helps to make BOTH Mountain Dew Lamps and Coca-cola lamps). Please give the journal entry to describe this. MOH $800 RMI Grease (10lbs @ $80/1b) $800 WE DO NOT DO THE BELOW BECAUSE IT WOULD CREATE SEASONAL FLUCTATIONS IN THE COST/MDLAMP & CCLAMP. The January MDL's and CC"ls would be far too expensive! WIP-MDL (jan) $300 WIP-CCL (jan) $500 RMI Grease (10 lbs@$80/1b) $800 8. During January, ALC workers worked the following: a. Mountain Dew Lamp workers => 100 dlh and they are paid $10/dlh IN CASH: b. Coca-Cola Lamp workers => 80 dlh and they are paid $25/dlh IN CASH. w WIP-MDL (100dlh *$10/d1h) $1,000 WIP-CCL (80 dlh *$25/dlh) $2,000 Cash $3,000 9. Please give the journal entry to APPLY overhead for the month of January. 9. Please give the journal entry to APPLY overhead for the month of January. WIP-MDL (100dlh*$5/dlh) WIP-CCL (80 dlh *$5/d1h) MOH $500 $400 $900 WIP-MDL (100dlh*$5/dlh) $500 100 dlh*($10,000/2,000dih) WHEN YOU APPLY, YOU MULTIPLY, YOU SIMULTANEOUSLY 100dlh/2,000dlh*($10,000) ALLOCATE ESTIM. ANNUAL OVERHEAD 5% of the estimated annual MOH of $10,000 got allocated to JANUARY MDLamps. NOTICE the THREE RATES. The $10/dlh is what we pay our MDLamp workers and they can be SEPARATED from the Coca-Cola Lamp workers (identification badges) and what we pay a worker has a 'cause-and-effect' (or R-square) of pretty much 100%. If a MDLamp worker works 1 DLH, we KNOW we owe him/her $10...pretty much guaranteed. If a CCLamp worker works 1 DLH, we pretty much KNOW we owe him/her $25. ON THE OTHER HAND, the $5/dlh MUST appear at least TWICE (because we have two products) and it is the SAME for both MDLamps and CCLamps. WE THINK/ESTIMATE that for every DLH (regardless of WHO worked), our COMPANY will incur $5 MORE worth of grease/utilities/rent and depreciation. Why $5/dlh TWICE? Because the COSTS are COMMON to both MD Lamps and CCLamps and we CANNOT trace/measure the amount of rent/utilities/grease/depreciation into a particular lamp as these costs are indirect in nature. THERE SHOULD NOT BE A SEPARATE PDOH for each product because we CANNOT trace/assign these common/indirect product cost to a particular type of lamp. 10. Please create TWO January JOB COST SHEETS (one Mountain Dew Lamps; one Coca-Cola Lamps) and compute cost per Mountain Dew Lamp and Coca Cola lamp. JOB COST SHEET: Mountain Dew Lamps Direct Materials $1,000 $200 $1,200 Direct Labor $1,000 (100dlh*$10/dlh) $1,000 MOH $500 (100 dlh*$5/dlh) $500 Total COGM $2,700 Total cost/unit 100 lamps=> $27/mdl JOB COST SHEET: Coca-Cola Lamps Direct Materials $4,000 Direct Labor $2,000 MOH $400 Total COGM Total cost/unit 200 lamps=> $1,000 (80dlh*$25/dh) (80 dlh*$5/dlh) $5,000 $2,000 $400 $7,400 $37/cclamp 11. On 1/31, ALC receives its January utility bill for $1,000 and pays for it in CASH. These utilities pertain to the manufacturing facility. Please give the journal entry. MOH $1,000 Cash $1,000 12. On 1/31, ALC receives its monthly rent bill for its manufacturing facility for $300 and pays for it in CASH. This rent pertains to the manufacturing facility. Please give the journal entry. $300 MOH Cash $300 13. On 1/31, ALC makes it monthly depreciation entry for the lamp-making equipment. Straight line depreciation of a $6,000 asset over 5 years is $1,200 per year or....$100 per month. Please give the appropriate depreciation journal entry for the month of January. MOH $100 Accum Depreciation-Lamp Making Machine $100 14. On 1/31, ALC workers completed 100 Mountain Dew Lamps and 200 Coca-cola lamps AND all 100/200 Mountain Dew/Coca-cola lamps were transferred to the finished goods. To give the journal entry, utilize the two separate Job Cost Sheets you completed earlier. FGI MDL FGI CCL WIP MDL WIP CCL $2,700 $7,400 $2,700 $7,400 - 15. On 2/1, ALC sold all 100 Mountain Dew Lamps it made in January - on account for $50/lamp. Please give the journal entry. AR (100 mdls *$50/mdlamp) Sales COGS (100 mdls *$27/mdlamp) FGI MDL $5,000 $5,000 $2,700 $2,700 16. On 2/1, ALC all sold 200 Coca-cola lamps it made in January for CASH for $100/lamp. Please give the appropriate journal entry. Cash (200 CClamps*$100/cclamp) $20,000 Sales $20,000 COGS (200 CClamps *$37/cclamp) $7,400 FGI CCL $7,400