Question

Yurman Inc. uses a job-order costing system. During the month of May, the following transactions occurred: May 1 Purchased materials on account for $29,670. 3 Requisitioned materials totaling $24,500 for use in production. Of the total, $9,200 was for Job 58, $8,900 for Job 59, and the remainder for Job 60. 31 Incurred direct labor for the month of $32,400, with an average wage of $18 per hour. Job 58 used 800 hours; Job 59, 600 hours; and Job 60, 400 hours. 31 Incurred and paid actual overhead of $17,880 (credit Various Payables). 31 Charged overhead to production at the rate of $4.80 per direct labor hour. 31 Completed and transferred Jobs 58 and 59 to Finished Goods. 31 Sold Job 57 (see beginning balance of Finished Goods) and Job 58 to their respective clients on account for a price of cost plus 40%. Beginning balances as of May 1 were: Materials $2,300 Work in Process 0 Finished Goods (Job 57) 25,600Required:1. Prepare journal entries for transactions from May 1 through 31.2. Prepare brief job-order cost sheets for Jobs 58, 59, and 60.3. Calculate the ending balance of Raw Materials.4. Calculate the ending balance of Work in Process.5. Calculate the ending balance of Finished Goods.

Answer 1

Answer:

Job cost sheet

Beginning /Materials / Labor / *overhead / Total

>J/58 0    9200   14400   3840 27440

>J/59 0    8900   10800   2880 22580

>J/60 0    6400     7200    1920 15520

          24500 32400 8640 65540

Journal entries:

raw materials    29670

accounts payable   29670

WIP   24500

raw materials   24500

WIP   32400

wages payables   32400

factory overhead   17880

accounts payable   17880

WIP   8640

factory overhead   8640

Finished Goods   50,020**

WIP inventory   50,020

     

***COGS              53,040

Finished Goods   53,040

Accounts receivables     74256

         *4  Sales revenue            74256

Explanation:

* the overhead is calcualte as the direct labor per job (800 ; 600;  400 respectively) times the overhead rate of 4.80

** the finished goods are Job 58 for a cost of 27,440 and 59 which cost is 22,580 we add the mand get 50,020 for the amount transferred int ofinished goods

***the cost of good sold will be J/57 of 25,600 plus J/58

*4 the sales revenue will be COGS times 1.4 as is the manufacturing cost plus a 405 markup.