(Video) Crane Company uses a job order cost system and applies overhead to production on the basis of direct labor costs. On January 1, 2020, 1ob 50 was the only job in process. The costs incurred prior to January 1 on this job were as follows: direct materials $24,800, direct labor $14,880, and manufacturing overhead $19,840. As of January 1, Job 49 had been completed at a cost of $111,600 and was part of finished goods inventory. There was a $18,600 balance in the Raw Materials Inventory account. During the month of January, Crane 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 $151,280 and $195,920, respectively. The following additional events occurred during the month. 1. 2. 3. Purchased additional raw materials of $111,600 on account. Incurred factory labor costs of $86,800. Of this amount $19,840 related to employer payroll taxes. Incurred manufacturing overhead costs as follows: indirect materials $21,080; indirect labor $24,800; depreciation expense on equipment $14,880; and various other manufacturing overhead costs on account $19,840. Assigned direct materials and direct labor to jobs as follows. 4. Job No. 50 51 52 Direct Materials $12,400 48,360 37,200 Direct Labor $6,200 31,000 24,800 (a) Calculate the predetermined overhead rate for 2020, assuming Crane Company estimates total manufacturing overhead costs of $1,041,600, direct labor costs of $868,000, and direct labor hours of 24,800 for the year. 1,041,600/ Predetermined overhead rate enter the predetermined overhead rate in percentages (c) Prepare the journal entries to record (1) the purchase of raw materials, (2) the factory labor costs incurred, and (3) the manufacturing overhead costs incurred during the month of January. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) No. Account Titles and Explanation enter an account title to record the first transaction (1) Debit enter a debit amount Credit enter a credit amount enter an account title to record the first transaction enter a debit amount enter a credit amount enter an account title to record the second transaction enter a debit amount enter a credit amount 2) enter an account title to record the second transaction enter a debit amount enter a credit amount enter an account title to record the second transaction enter a debit amount enter a credit amount enter an account title to record the third transaction enter debit amount enber a credit amount (3) enter an account title to record the third transaction enter a debit amount enter a credit amount enter an account title to record the third transaction enter a debit amount enter a credit amount enter an account title to record the third transaction enter a debit amount enter a credit amount enter a debit amount enter a credit amount enter an account title to record the third transaction (d1) Prepare the journal entries to record the assignment of (1) direct materials, (2) direct labor, and (3) 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.) Credit enter a credit amount Debit enter a debit amount No. Account Titles and Explanation enter an account title to record the first transaction (1) enter a credit amount enter a debit amount enter an account title to record the first transaction enter a credit amount enter a debit amount (2) enter an account title to record the second transaction
