1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Liono4ka [1.6K]
3 years ago
9

Degelman Company uses a job order cost system and applies overhead to production on the basis of direct labor costs. On January

1, 2014, Job No. 50 was the only job in process. The costs incurred prior to January 1 on this job were as follows: direct materials $22,600, direct labor $13,560, and manufacturing overhead $18,080. As of January 1, Job No. 49 had been completed at a cost of $101,700 and was part of finished goods inventory. There was a $16,950 balance in the Raw Materials Inventory account.
During the month of January, Deglman Manufacturing 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 $137,860 and $178,540, respectively. The following additional events occurred during the month.
1. Purchased additional raw materials of $101,700 on account.
2. Incurred factory labor costs of $79,100. Of this amount $18,080 related to employer payroll taxes.
3. Incurred manufacturing overhead costs as follows: indirect materials $19,210; indirect labor $22,600; depreciation expense on equipment $21,470; and various other manufacturing overhead costs on account $18,080.
4. Assigned direct materials and direct labor to jobs as follows.
Job No. Direct Materials Direct Labor
50 $11,300 $5,650
51 44,070 28,250
52 33,900 22,600
1. Calculate the pre-determined overhead rate for 2014, assuming Degelman Company estimates total manufacturing overhead costs of $1,107,400, direct labor costs of $791,000, and direct labor hours of 22,600 for the year.
2. 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.
3. 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).
4. Total the job cost sheets for any job(s) completed during the month. Prepare the journal entry (or entries) to record the completion of any job(s) during the month.
5. Prepare the journal entry (or entries) to record the sale of any job(s) during the month. What is the balance in the Finished Goods Inventory account at the end of the month? What is the amount of over- or underapplied overhead?
Business
1 answer:
Oduvanchick [21]3 years ago
4 0

Answer:

Degelman Company

1. Predetermined overhead rate for 2014 = Total manufacturing overhead/total direct labor costs

= $81,360/$79,100

= $1.03 per direct labor cost

2. Journal Entries to record the purchase of raw materials, factory labor costs incurred, and the manufacturing overhead costs:

Debit Raw materials $101,700

Credit Accounts Payable $101,700

To record the purchase of raw materials in January, 2014.

Debit Factory labor $79,100

Credit Wages & Salaries Expense $79,100

To Wages Expense to factory labor.

Debit Manufacturing overhead $81,360

Credit Raw materials $19,210

Credit Wages & Salaries expense $22,600

Credit Depreciation expense on equipment $21,470

Credit Accounts Payable $18,080

To record manufacturing overhead costs.

To record manufacturing overhead costs

3a. Debit Job 50 $11,300

   Debit Job 51 $44,070

   Debit Job 52 $33,900

   Credit Raw materials $89,270

To assign raw materials to Jobs.

3b. Debit Job 50 $5,650

   Debit Job 51 $28,200

   Debit Job 52 $22,600

   Credit Factory labor $56,450

To assign direct labor to Jobs.

3c. Debit Job 50 $5,820

     Debit Job 51 $29,046

     Debit Job 52 $23,278

     Credit Manufacturing overhead $58,144

To assign manufacturing overheads to Jobs using the predetermined rate.

4.                                 Job 50       Job 51

Beginning balance $54,240

Raw materials          $11,300       $44,070

Direct labor              $5,650         28,200

Overhead                $5,820         29,046

Total costs             $77,010        $101,316

Journal Entries:

Debit Finished Goods Inventory $178,326

Credit Job 50 $77,010

Credit Job 51 $101,316

To record the completion of Jobs 50 and 51.

5. Debit Cost of Goods Sold $178,710

   Credit Finished Goods Inventory $178,710

To record the cost of goods sold (Jobs 49 and 50)

Debit Cash (Job 49) $137,860

Debit Accounts Receivable (Job 50) $178,540

Credit Sales Revenue $316,400

To record the sale of Jobs 49 and 50.

5b. Balance in the Finished Goods Inventory account is: $181,094

                           Job 51          Job 52

Raw materials    $44,070       $33,900

Direct labor       $28,200         22,600

Overhead          $29,046          23,278

Total costs         $101,316        $79,778

5c. Over- or underapplied overhead:

Actual overhead costs incurred $81,360

Applied overhead costs              $58,144

Underapplied overhead costs   $23,216

Explanation:

a) Data and Calculations:

Jan. 1, 2014: Job 50 in process

Job 50 costs:

Direct materials $22,600

Direct labor $13,560

Manufacturing overhead $18,080

Balance = $54,240

Job 49 completed at a cost of $101,700

Raw Materials Inventory = $16,950

Started production on Jobs 51 and 52

Completed Jobs 50 and 51

Sales:

Job 49 = $137,860

Job 50 = $178,540  sold on account

Additional events:

1. Purchase of raw materials $101,700 on account

2. Incurred Factory labor = $79,100

   Employer payroll taxes     18,080

   Net Factory labor =        $61,020

3. Incurred manufacturing overhead:

Indirect materials                                   $19,210

Indirect labor                                        $22,600

Depreciation expense on equipment  $21,470

Other manufacturing overhead costs $18,080 on account

Total manufacturing overhead costs  $81,360

4. Assigned direct materials, direct labor, and overhead to Jobs:

Job No. Direct Materials  Direct Labor   Manufacturing Overhead  Total

50           $11,300              $5,650           $5,820 ($1.03 * $5,650)

51             44,070              28,200         $29,046 ($1.03 * $28,200)

52           33,900              22,600          $23,278 ( ($1.03 * $22,600)

Total     $89,270            $56,450           $58,144

You might be interested in
Paden Company purchased merchandise from Emmett Company with freight terms of FOB shipping point. The freight costs will be paid
Nikitich [7]

Answer:

Buyer (Paden Company)

Explanation:

The freight costs will be paid by the Buyer. FOB shipping point means that the Buyer takes all the risks and rewards associated with the purchase as soon as the goods leave sellers location.

8 0
2 years ago
A moderately-priced jewelry store is trying to differentiate itself from other jewelry stores. The store prices products somewha
AlekseyPX

Answer:

The correct answer is: monopolistic competition.

Explanation:

There is monopolistic competition in markets that have many companies offering similar products or services. Restaurants, grocery stores, and clothing stores, for example. Such similar products and services are not ideal substitutes for each other. In these industries the barrier to entry and exit is low.

8 0
3 years ago
Which of the following BEST describes a mission? an objective that a business hopes and plans to achieve the shared experiences,
nevsk [136]

Answer:

An organisation statement on how it will achieve its purpose in the environment in which it conducts business.

Explanation:

A mission statement can be defined as a statement which explains the reasons for an organisation existence, it also explains what a business aims to achieve at a long-run.

All organisations have their different mission statements which clearly defines the purpose of the business. It is used to create a form of direction and also motivation to the various employees of the organisation.

Mission statements serves as a guide that enables the organisation to achieve their objectives and goals, It also helps in the planning of future aspirations.

4 0
3 years ago
Drew is in charge of writing a report for his company that talks about the quality and safety of his company's products, busines
ira [324]

Answer: Compliance review

Explanation: A compliance review can be defined as an audit done with the objective to assess whether the company is following the regulatory guidelines. In such a review the auditor tries to determine if the items that being examined complies with the set standards.

In the given case, Drew is  writing the report to spread the information that they are following all the guidelines related to safety and quality.

Thus, from the above we can conclude that the correct option is C.

7 0
3 years ago
The income section of a budget will include your
Oksanka [162]
I think the answer is D
3 0
2 years ago
Other questions:
  • Operational-level manufacturing systems deal with the firm's long-term manufacturing goals, such as where to locate a new plant.
    9·1 answer
  • In the internet age, retailers like amazon and apple are not constrained by physical shelf space and can offer consumers a much
    14·1 answer
  • Assume that Delalo, Inc. is operating at full capacity. Also assume that assets, costs, and current liabilities vary directly wi
    11·2 answers
  • Harwood Company uses a job-order costing system that applies overhead cost to jobs on the basis of machine-hours. The company's
    11·1 answer
  • When banks are compared to retail stores, banks are said to “buy” money. What does the term “buy” refer to? The bank collaterali
    12·2 answers
  • When the Fed carries out contractionary monetary policy through selling bonds __________. Select the correct answer below: it re
    6·1 answer
  • WebHelper Inc. acquired 100% of the outstanding stock of Silicon Chips Corporation (SCC) for $45 million, of which $15 million w
    12·1 answer
  • Cullumber Corporation purchased a machine on January 2, 2020, for $4100000. The machine has an estimated 5-year life with no sal
    14·2 answers
  • _____ are different, even within the same job. A. Occupations b. Workplaces c. Careers d. Interest rates Please select the best
    15·1 answer
  • The purpose of business aviation is to provide safe, efficient, and convenient air transportation to support the mission and goa
    7·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!