Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Terminus Company completed two jobs during January, Job Z-15 and Job W-20. Completing Job Z-15 required an additional $2,720 in direct labour and completing Job

Terminus Company completed two jobs during January, Job Z-15 and Job W-20. Completing Job Z-15 required an additional $2,720 in direct labour and completing Job W-20 required $1,296 in direct materials and $8,000 in direct labour.

The details of the two jobs in process on January 1 are as follows:

Job Z-15

Job W-20

Direct Materials

$ 2,038

$ 1,280

Direct Labour

768

3,360

On January 1 the Materials Inventory balance was $11,040, and $1,392 worth of materials was purchased during the month. Indirect materials of $672 were withdrawn from materials inventory.

Terminus allocates overhead to jobs at an estimated rate of 50 percent of direct labour costs. Terminus used a total of $3,768 of direct materials (excluding the $672 indirect materials) during the period and total direct labour costs during the month were $10,720. In addition, during the month they incurred 2,450 in utilities costs, 1,200 in depreciation expenses and $3,600 in rent.

Question

  1. Compute the total costs to manufacture Job Z-15 and Job W-20.
  2. During the month of January was Terminus' overhead over or under applied and by how much? Assume the amount of under/over applied overhead is insignificant. Prepare the journal entry to write off the overhead assuming Terminus uses the two account approach for overhead.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Auditing A Practical Approach

Authors: Robyn Moroney, Fiona Campbell, Jane Hamilton, Valerie Warren

4th Canadian Edition

1119709490, 9781119709497

More Books

Students also viewed these Accounting questions

Question

Discuss the goals of financial management.

Answered: 1 week ago

Question

Distinguish between recruitment sources and recruitment methods.

Answered: 1 week ago

Question

How has social media emerged as an important force in recruiting?

Answered: 1 week ago

Question

5.5 Summarize external recruitment methods.

Answered: 1 week ago