Answer:
Milling Department
a) Debit Job 111407A $1,402.25
Credit Raw materials $1,402.25
To transfer raw materials to the Job.
b) Debit Job 111407A $1,041.00
Credit Wages & Salaries Expense $1,041.00
To transfer labor cost to the Job.
c) Debit Raw materials Inventory $75.75
Credit Job 111407A $75.75
To return 50 pounds oats, 5 pounds of barley, and 5 quarts of honey to raw materials inventory.
d) Debit Job 111407A $5,893.75
Credit Manufacturing overhead $5,893.75
To apply manufacturing overhead to the Job.
e) Debit Finished Goods $8,337.00
Credit Job 111407A $8,337.00
To transfer Job 111407A to Finished Goods.
Explanation:
Job 111407A for 1,000 pounds of cereal mix
Materials: Standard Qty. Standard Cost Cost per material
Oats 525 pounds $1.25 per pound $656.25 (525 * $1.25)
Wheat 450 pounds $1.15 per pound 517.50 (450 * $1.15)
Barley 85 pounds $1.45 per pound 123.25 (85 * $1.45)
Malt 65 pounds $2.15 per pound 139.75 (65 * $2.15)
Honey 25 quarts $1.20 per quart 30.00 (25 * $1.20)
Water 25 gallons $0.45 per gallon 11.25 (25 * $0.45)
Total cost of production $1,478.00
Less Returns to Raw Materials Inventory 75.75
Total cost of materials used $1,402.25
Returned Raw Materials:
50 pounds oats at $1.25 per pound $62.50 (50 * $1.25)
5 pounds of barley at $1.45 per pound 7.25 (5 * $1.45)
5 quarts of honey at $1.20 per quart 6.00 (5 * $1.20)
Total cost of returned raw materials = $75.75
Time: Labor Costs:
Miller 4 1/2 hours $22.75 per hour = $1,023.75 (4 1/2 * $22.75)
Loader 1 1/2 hours $11.50 per hour = 17.25 (1 1/2 * $11.50)
Total labor costs = $1,041.00
Manufacturing overhead rate = $5.75 per pound completed
Production unit = 1,025
Total manufacturing overhead applied = $5,893.75 (1,025 * $5.75)
Total costs of production of 1,025 pounds of cereal mix:
Total cost of raw materials used = $1,402.25
Total labor cost = 1,041.00
Manufacturing overhead applied = 5,893.75
Total production costs = $8,337.00
Unit cost of production = $8.134 ($8,337/1,025) per pound
