Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The following information is available for Elliot Company. January 1, 2016 2016 December 31, 2016 $26,000 18,500 30,000 $30,000 22,200 21,000 Raw materials inventory Work

image text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribed

The following information is available for Elliot Company. January 1, 2016 2016 December 31, 2016 $26,000 18,500 30,000 $30,000 22,200 21,000 Raw materials inventory Work in process inventory Finished goods inventory Materials purchased Direct labor Manufacturing overhead Sales $170,000 230,000 180,000 800,000 Compute cost of goods manufactured. Cost of goods manufactured $ ELLOIT COMPANY Income Statement December 31, 2016 HA Lott Company uses a job order cost system and applies overhead to production on the basis of direct labor costs. On January 1, 2017, Job No. 50 was the only job in process. The costs incurred prior to January 1 on this job were as follows: direct materials $22,400, direct labor $13,440, and manufacturing overhead $17,920. As of January 1, Job No. 49 had been completed at a cost of $100,800 and was part of finished goods inventory. There was a $16,800 balance in the Raw Materials Inventory account. During the month of January, Lott Company began production on Jobs 51 and 52, and completed Jobs 50 and 51. Jobs 49 and 50 were also sold on account during the month for $136,640 and $176,960, respectively. The following additional events occurred during the month. 1. 2. 3. Purchased additional raw materials of $100,800 on account. Incurred factory labor costs of $78,400. Of this amount $17,920 related to employer payroll taxes. Incurred manufacturing overhead costs as follows: indirect materials $19,040; indirect labor $22,400; depreciation expense on equipment $13,440; and various other manufacturing overhead costs on account $17,920. Assigned direct materials and direct labor to jobs as follows. 4. Job No. Direct Materials Direct Labor 50 $5,600 51 $11,200 43,680 33,600 28,000 52 22,400 Calculate the predetermined overhead rate for 2017, assuming Lott Company estimates total manufacturing overhead costs of $940,800, direct labor costs of $784,000, and direct labor hours of 22,400 for the year. (Round answer to the nearest whole percent, e.g. 25%.) Predetermined overhead rate Open job cost sheets for Jobs 50, 51, and 52. Enter the January 1 balances on the job cost sheet for Job No. 50. Job No. 50 Date Direct Materials Direct Labor Manufacturing Overhead Beg. Jan. $ ta ta Cost of completed job Direct materials $ Direct labor Manufacturing overhead Total cost $ Job No. 51 Date Direct Materials Direct Labor Manufacturing Overhead Jan. AL $ $ $ Cost of completed job Direct materials Direct labor Manufacturing overhead Total cost Job No. 52 Date Direct Materials Direct Labor Manufacturing Overhead Jan. Prepare the journal entries to record the purchase of raw materials, the factory labor costs incurred, and the manufacturing overhead costs incurred during the month of January. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Debit Credit No. Account Titles and Explanation (1) Prepare the journal entries to record the assignment of direct materials, direct labor, and manufacturing overhead costs to production. In assigning manufacturing overhead costs, use the overhead rate calculated in (a). (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Debit Credit No. Account Titles and Explanation (1) Total the job cost sheets for any job(s) completed during the month. Prepare the journal entry to record the completion of any job(s) during the month. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit What is the amount of over- or underapplied overhead? Manufacturing Overhead $ Click if you would like to Show Work for this question: Open Show Work Rosenthal Company manufactures bowling balls through two processes: Molding and Packaging. In the Molding Department, the urethane, rubber, plastics, and other materials are molded into bowling balls. In the Packaging Department, the balls are placed in cartons and sent to the finished goods warehouse. All materials are entered at the beginning of each process. Labor and manufacturing overhead are incurred uniformly throughout each process. Production and cost data for the Molding Department during June 2017 are presented below. June 0 Production Data Beginning work in process units Units started into production Ending work in process units Percent complete-ending inventory 25,080 2,280 40 % Cost Data Materials Labor $225,720 61,104 128,592 $415,416 Overhead Total Prepare a schedule showing physical units of production. Physical units Units to be accounted for Work in process, June 1 Started into production Total units Units accounted for Transferred out Work in process, June 30 Total units Determine the equivalent units of production for materials and conversion costs. Materials Conversion Costs Total equivalent units Compute the unit costs of production. (Round unit costs to 2 decimal places, e.g. 2.25.) Materials Conversion Costs Total Unit Cost Unit Costs $ Determine the costs to be assigned to the units transferred and in process for June. Transferred out Work in process, June 30+ ROSENTHAL COMPANY Molding Department Production Cost Report For the Month Ended June 30, 2017 Equivalent Units Physical Units Conversion Costs Materials Quantities Units to be accounted for Work in process, June 1 Started into production Total units Units accounted for Transferred out Work in process, June 30 Total units Conversion Costs Costs Materials Total Unit costs Total Costs ta Equivalent units Unit costs Al $ Costs to be accounted for Work in process, June 1 $ Started into production Total costs Cost Reconciliation Schedule Costs accounted for Transferred out $ Work in process, June 30 Materials $ Conversion costs Total costs ta Click if you would like to Show Work for this question: Open Show Work Combat Fire, Inc. manufactures steel cylinders and nozzles for two models of fire extinguishers: (1) a home fire extinguisher and (2) a commercial fire extinguisher. The home model is a high-volume (54,000 units), half-gallon cylinder that holds 2 1/2 pounds of multi-purpose dry chemical at 480 PSI. The commercial model is a low-volume (10,200 units), two-gallon cylinder that holds 10 pounds of multi-purpose dry chemical at 390 PSI. Both products require 1.5 hours of direct labor for completion. Therefore, total annual direct labor hours are 96,300 or [1.5 hours X (54,000 + 10,200)]. Expected annual manufacturing overhead is $1,561,700. Thus, the predetermined overhead rate is $16.22 or ($1,561,700 = 96,300) per direct labor hour. The direct materials cost per unit is $18.50 for the home model and $26.50 for the commercial model. The direct labor cost is $19 per unit for both the home and the commercial models. The company's managers identified six activity cost pools and related cost drivers and accumulated overhead by cost pool as follows: Expected Use of Drivers by Product Expected Use of Cost Drivers Activity Cost Pools Cost Drivers Estimated Overhead Home Commercial Receiving Pounds Forming Machine hours Assembling Number of parts 335,000 35,000 217,000 25,500 5,258 335,000 $84,400 149,000 403,000 48,000 54,300 823,000 $1,561,700 215,000 27,000 165,000 15,500 3,680 215,000 120,000 8,000 52,000 10,000 1,578 120,000 Testing Number of tests Painting Gallons Packing and shipping Pounds Under traditional product costing, compute the total unit cost of each product. (Round answers to 2 decimal places, e.g. 12.25.) Home Model Commercial Model Total unit cost Under ABC, prepare a schedule showing the computations of the activity-based overhead rates (per cost driver). (Round overhead rate to 2 decimal places, e.g. 12.25.) Activity Cost Pool Estimated Overhead Expected Use of Cost Drivers Activity-Based Overhead Rate Receiving Pounds per pound ____ Forming Machine hours per machine hour Assembling Parts per part Testing Tests per test Painting Gallons per gallon Packing and shipping Pounds per pound $ Prepare a schedule assigning each activity's overhead cost pool to each product based on the use of cost drivers. (Round overhead cost per unit to 2 decimal places, e.g. 12.25 and cost assigned to 0 decimal places, e.g. 2,500.) Home Model Expected Use of Activity-Based Drivers Overhead Rates Commercial Model Expected Use of Activity-Based Drivers Overhead Rates Activity Cost Pool ost Assigned Cost Assigned Receiving o Forming o Assembling o Testing o Painting o Packing and shipping o Total costs assigned (a) Units produced (b) Overhead cost per unit [(a) (b)] ta $ Compute the total cost per unit for each product under ABC. (Round answer to 2 decimal places, e.g. 12.25.) Home Model Commercial Model Total cost per unit $ Classify each of the activities as a value-added activity or a non-value-added activity. Activity Receiving Forming Assembling Testing Painting Packing and shipping Click if you would like to Show Work for this question: Open Show Work

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

Financial & Managerial Accounting For Undergraduates

Authors: Jason Wallace, James Nelson, Karen Christensen, Theodore Hobson, Scott L. Matthews

2nd Edition

161853310X, 9781618533104

More Books

Students also viewed these Accounting questions

Question

What are the important facts related to this situation?

Answered: 1 week ago