Transactions for January Year 1, First Month of Operation 1. Issued common stock for $11,000. 2. Purchased $415 of direct raw materials and $65 of production supplies. 3. Used $258 of direct raw materials. 4. Used 80 direct labor hours, production workers were paid $9.70 per hour. 5. Expected total overhead costs for the year to be $3,000, and direct labor hours used during the year to be 1,000. Calculate an overhead rate and apply the appropriate amount of overhead costs to Work in Process Inventory. 6. Paid $142 for salaries to administrative and sales staff. 7. Paid $22 for indirect manufacturing labor. 8. Paid $210 for rent and utilities on the manufacturing facilities. 9. Started and completed 100 remote controls during the month; all costs were transferred from the Work in Process Inventory account to the Finished Goods Inventory account. 10. Sold 80 remote controls at a price of $21.20 each. Transactions for Remainder of Year 1 11. Acquired an additional $18,000 by issuing common stock. 12. Purchased $3,950 of direct raw materials and $890 of production supplies. 13. Used $3,020 of direct raw materials. 14. Paid production workers $9.70 per hour for 900 hours of work. 15. Applied the appropriate overhead cost to Work in Process Inventory. 16. Paid $1,550 for salaries of administrative and sales staff. 17. Paid $243 of indirect manufacturing labor cost. 18. Paid $2,410 for rental and utility costs on the manufacturing facilities. 19. Transferred 900 additional remote controls that cost $12.74 each from the Work in Process Inventory account to the Finished Goods Inventory account. 20. Determined that $167 of production supplies was on hand at the end of the accounting period. 21. Sold 840 remote controls for $21.20 each. 22. Determine whether the overhead is over- or underapplied. Close the Manufacturing Overhead account to the Cost of Goods Sold account. 23. Close the revenue and expense accounts. Required a. For each of the above transactions, post the effects to the appropriate T-accounts. b. Prepare a schedule of cost of goods manufactured and sold, an income statement, and a balance sheet for Year 1. Transactions for January Year 1, First Month of Operation 1. Issued common stock for $11,000. 2. Purchased $415 of direct raw materials and $65 of production supplies. 3. Used $258 of direct raw materials. 4. Used 80 direct labor hours, production workers were paid $9.70 per hour. 5. Expected total overhead costs for the year to be $3,000, and direct labor hours used during the year to be 1,000. Calculate an overhead rate and apply the appropriate amount of overhead costs to Work in Process Inventory. 6. Paid $142 for salaries to administrative and sales staff. 7. Paid $22 for indirect manufacturing labor. 8. Paid $210 for rent and utilities on the manufacturing facilities. 9. Started and completed 100 remote controls during the month; all costs were transferred from the Work in Process Inventory account to the Finished Goods Inventory account. 10. Sold 80 remote controls at a price of $21.20 each. Transactions for Remainder of Year 1 11. Acquired an additional $18,000 by issuing common stock. 12. Purchased $3,950 of direct raw materials and $890 of production supplies. 13. Used $3,020 of direct raw materials. 14. Paid production workers $9.70 per hour for 900 hours of work. 15. Applied the appropriate overhead cost to Work in Process Inventory. 16. Paid $1,550 for salaries of administrative and sales staff. 17. Paid $243 of indirect manufacturing labor cost. 18. Paid $2,410 for rental and utility costs on the manufacturing facilities. 19. Transferred 900 additional remote controls that cost $12.74 each from the Work in Process Inventory account to the Finished Goods Inventory account. 20. Determined that $167 of production supplies was on hand at the end of the accounting period. 21. Sold 840 remote controls for $21.20 each. 22. Determine whether the overhead is over- or underapplied. Close the Manufacturing Overhead account to the Cost of Goods Sold account. 23. Close the revenue and expense accounts. Required a. For each of the above transactions, post the effects to the appropriate T-accounts. b. Prepare a schedule of cost of goods manufactured and sold, an income statement, and a balance sheet for Year 1
