Sweet Wave Bakery (SWB) is a private corporate that was formed to provide cakes, breads and other sweets to commercial businesses and private individuals. It is located in Chicago, IL and manufactures the products in the home location and ships the product to retail outlets across the United States. It also has a division that provides onsite bakery installation and warranty services.

SWBs mission is to provide high quality bakery products to satisfy their customers needs and to be recognized as a positive impact in the community. Because of its quality products and community involvement, the company has been growing quickly and is always looking for ways to expand their product line and continue to grow while still remaining profitable.

Sweet Wave Bakery was founded by Sally Wasterton who is the company president and CEO. Sallys brother, Mark, has been working with Sally from the beginning developing new ideas and new recipes for the bakery. Mark is the Vice President of the company with Rolando Garras acting as the factory manager. Rolando is responsible for hiring line managers in the Chicago plant and Vice President Laila Jackson is responsible for the local divisions that install bakery equipment. SWB has a centralized human resources department that is managed by Pat Wilmington. The CFO of the organization, Rebecca Martinez, is in charge of the accounting and finance department. Rebecca has a small staff of CPAs working for her.

The following has been pulled from the financial records of Sweet Wave Bakery for the month of November 20X6.

Accounts Receivable

$ 275,000

Advertising Expenses

54,000

Cash

260,000

DepreciationFactory Equipment

16,800

DepreciationOffice Equipment

2,400

Direct Labor

42,000

Factory Supplies Used

16,800

Factory Utilities

10,200

Finished Goods Inventory, November 30

68,800

Finished Goods Inventory, October 31

72,550

Indirect Labor

48,000

Office Supplies Expense

1,600

Other Administrative Expenses

72,000

Prepaid Expenses

41,250

Raw Materials Inventory, November 30

52,700

Raw Materials Inventory, October 31

38,000

Raw Materials Purchases

184,500

RentFactory Equipment

47,000

RepairsFactory Equipment

4,500

Salaries

325,000

Sales

1,350,000

Sales Commissions

40,500

Work In Process Inventory October 31

52,700

Work In Process Inventory, November 30

42,000

Sweet Bakery Case - Part 2 - 50points. Sweet Wave was able to secure some large orders to supply bakery goods for 2 special events, G52 and R5. Both of these projects will require special order cakes. Sweet Wave decided to use a job cost system to produce the cakes. The following information relates to G52 and R5 for 20X6.

December 2: Raw materials were requisitioned from the companys inventory for $5,061

December 8: Raw materials were requisitioned for $1,059

December 14: Raw materials were requisitioned for $3,459.

In each instance, two- thirds (2/3) of these materials were for G52 and the rest for R5.

Payroll:

Time worked on these two projects were recorded electronically by employees. The total amount of hours worked on the projects were as follows:

6 employees that are paid $16.50 per hour worked 18 hours on both projects. The time tickets were dated December 3, December 9, and December 15.

On each of those days, 6 labor hours were spent on these jobs, two-thirds (2/3) for G52 and the rest for R5.

Sweet Wave Bakery has decided to allocate overhead based on the machine hours. The expected machine hour use for the year is 2,112 hours, and the anticipated overhead costs are $840,576 for the year.

The machines were used by workers on projects R5 and G52 on December 3, 9, and 15.

Six machine hours were used for project R5 (2 each day), and 8.5 machine hours were used for project G52 (2.5 the first day and 3 each of the other days). Both of these special orders were completed on December 15, producing 237 pies for G52 and 142 pies for R5.

Additional job order activities during this period of time included:

Dec. 1 Purchased raw materials from Dawson Wheat Company on account for $53,200.

Dec. 2 Issued $40,000 of direct materials from the companys inventory to jobs other than R5 and G52 and $3,000 of indirect materials.

Dec. 12 Paid Sweet Wave Bakerys factory salaries and wages in the amount of $65,000.

Dec. 13 Paid the factorys water bill of $9,000.

Dec. 18 Transferred $50,000 of costs from other completed jobs to finished goods.

Dec. 21 Paid the factorys electric bill of $12,000 for Sweet Waves factory.

Dec. 31 Made adjusting entries for the factory that included accrued property taxes of $12,000, prepaid insurance of $8,800, and accumulated depreciation of $16,000.

Instruction (A)

(a) Set up the job cost sheets for Job No. G52 and Job No. R5. Determine the total cost for each manufacturing special order for these jobs. (Round unit cost to nearest cent.)

(b) Journalize the activities from these job cost sheets in the general journal. Also journalize the other costs that occurred during this period of time.

(c) Assuming that Manufacturing Overhead has a debit balance of $3,600, determine whether overhead has been under/over applied and make the adjusting entry.

Sweet Wave has multiple processing departments and handles the majority of its manufacturing as a process cost system. The departments are as follows:

Dough

Prep

Bake

All products end up in the packaging department which prepares items for sale.

The following information is available for the Dough department for January.

Work in process beginning:

Units in process

22,000

Stage of completion for materials

80%

Stage of completion for labor and overhead

Costs in work in process inventory:

Materials

30%

$168,360

Labor

67,564

Overhead

17,270

Total costs in beginning work in process

$253,194

Units started into production in January

60,000

Units completed and transferred in January

58,000

Costs added to production:

Materials

$264,940

Labor

289,468

Overhead

60,578

Total costs added into production in January

$614,986

Work in process ending:

Units in process

24,000

Stage of completion for materials

50%

Stage of completion for labor and overhead

10%

Instruction (B)

(a) Prepare a production cost report for Sweet Wave using the weighted-average method.

Note: (a) Excel formulas must be used where needed. (b) Format numbers appropriately (\$ for example) cel formulas must be used where needed. t numbers appropriately ( $ for example) Note: (a) Excel formulas must be used where needed. (b) Format numbers appropriately (\$ for example) cel formulas must be used where needed. t numbers appropriately ( $ for example)