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
svet-max [94.6K]
3 years ago
11

Custom Cabinetry has one job in process (Job 120) as of June 30; at that time, its job cost sheet reports direct materials of $8

,700, direct labor of $4,200, and applied overhead of $3,570. Custom Cabinetry applies overhead at the rate of 85% of direct labor cost. During July, Job 120 is sold (on account) for $29,500, Job 121 is started and completed, and Job 122 is started and still in process at the end of the month. Custom Cabinetry incurs the following costs during July.
July Product Costs Job 120 Job 121 Job 122 Total
Total Direct materials $2,600 $8,300 $4,100 $15,000
Direct labor 3,200 4,500 3,600 11,300
Overhead applied ? ? ? ?

1. Prepare journal entries for the following in July.

a. Direct materials used in production
b. Direct labor used in production.
c. Overhead applied.
d. The sale of Job 120.
e. Cost of goods sold for Job 120.

2. Compute the July 31 balances of the Work in Process Inventory and the Finished Goods Inventory general ledger accounts.
Business
1 answer:
yaroslaw [1]3 years ago
6 0

Answer:

Custom Cabinetry

1. Journal Entries:

a. Debit Work in Process:

Job 120 $2,600

Job 121 $8,300

Job 122 $4,100

Credit Direct materials $15,000

To record the direct materials used in production in July.

b. Debit Work in Process:

Job 120 $3,200

Job 121 $4,500

Job 122 $3,600

Credit Payroll $11,300

To record the cost of direct labor for July.

c. Debit Work in Process:

Job 120 $2,720

Job 121 $ 3,825

Job 122 $3,060

Credit Overhead applied $9,605

To apply overhead at the rate of 85% of direct labor costs.

d. Debit Accounts Receivable $29,500

Credit Sales Revenue $29,500

To record the sale of Job 120 on account.

e. Debit Cost of goods sold $24,920

Credit Finished Goods: Job 120 $24,920

To record the cost of Job 120 sold.

2. July 31 Balances:

Work in Process Inventory = $10,760

Finished Goods Inventory $16,625

Explanation:

a) Data and Calculations:

Overhead application rate = 85% of direct labor cost

Sales price of Job 120 = $29,500

                                         Job 120    Job 121     Job 122      Total

Beginning inventory:

Direct materials              $8,700                                              $8,700

Direct labor                       4,200                                                4,200

Applied overhead             3,570                                                3,570

Total                              $16,400                                             $16,400

Costs incurred during July:

Total Direct materials $2,600        $8,300       $4,100        $15,000

Direct labor                   3,200           4,500        3,600           11,300

Overhead applied               ?                 ?                 ?                 ?

Cost of production:

                                         Job 120    Job 121     Job 122      Total

Beginning inventory:

Direct materials              $8,700                                               $8,700

Direct labor                       4,200                                                 4,200

Applied overhead             3,570                                                 3,570

Total                              $16,400                                              $16,400

Costs incurred during July:

Total Direct materials   $2,600        $8,300       $4,100        $15,000

Direct labor                     3,200           4,500        3,600           11,300

Overhead applied          2,720           3,825        3,060            9,605

Total production costs $24,920    $16,625     $10,760       $52,305

                                      Sold         Completed   In Process

You might be interested in
Match each term below with its correct definition.a.a crasha major decrease in stock prices.b.bear marketa general upward trend
Viefleur [7K]
A crash is a major decrease in stock prices.

A bear market is a general downward trend in stock prices.

A bull market is a general upward trend in stock prices.
6 0
3 years ago
If a perfectly competitive firm finds that price is less than average variable cost, it should: shut down immediately. increase
Musya8 [376]

Answer: It should shot down immediately.

Explanation:

If the market price is equal to average cost at the profit-maximizing level of output, then the firm is making zero profits. If the market price that a perfectly competitive firm faces is below average variable cost at the profit-maximizing quantity of output, then the firm should shut down operations immediately.

4 0
3 years ago
Which one of the following statements does NOT describe a problem with using ROE as a performance measure? A. ROE measures retur
Ne4ueva [31]

Answer:

B) ROE is a forward-looking, one-period measure, while business decisions span the past and present

Explanation:

ROE is a forward-looking, one-period measure, while business decisions span the past and present, this statement does not describe a problem with using ROE as a performance measure.

7 0
3 years ago
What is take-home pay?
katrin2010 [14]

Take home pay is the other term used for gross salary.Take home pay happens when all the tax and other payment obligations is already deducted. For Example: => you're monthly salary is 15 000 dollars. => your tax for example is 1500 dollars per month => then you have to pay also for your sss, pag-ibig, philhealth and any other payment that needs to be settled.<span>The your salary, minus the tax and other payments is equals the take home pay.</span>
3 0
3 years ago
McMahon Inc. reported the following on the company's statement of cash flows in 2016 and 2015:
podryga [215]

Answer:

$137,200; $103,600

Explanation:

In 2015:

Free cash flow:

= Net cash flow from operating activity - Capital expenditure

= $294,000 - (70% × $224,000)

= $294,000 - $156,800

= $137,200

In 2016:

Free cash flow:

= Net cash flow from operating activity - Capital expenditure

= $280,000 - (70% × $252,000)

= $280,000 - $176,400

= $103,600

3 0
3 years ago
Other questions:
  • Use this information for Train Corporation to answer the question that follow. The following financial information was summarize
    5·1 answer
  • How are the layers of the atmosphere and the hydrosphere different?
    10·1 answer
  • 21. Preferred stock pays quarterly dividend of $3 a share. If investors require 12% return on a stock of a similar risk level, w
    7·1 answer
  • A company's financial statements may contain errors even if debits and credit balance because:
    14·1 answer
  • When calculating the weighted average flotation cost, the weights should be based on the: O mix of debt and equity that will be
    6·1 answer
  • When a factory closes, why is it bad news for the local restaurants? a. Unemployed factory workers have lower incomes and are le
    6·1 answer
  • 1. describe the it architecture (both type of it architecture and its information system parts) at pepsiamericas before its cust
    6·1 answer
  • When Frozen DeLites Ice Cream moved from its longtime storefront to a famous resort area, it took a big risk. However, the owner
    10·1 answer
  • Why do you think consistency is so important between the Loan Estimate and the Closing Disclosure?
    9·1 answer
  • Millie is a buyer who has given her agent an earnest money check for $10,000 with an offer to purchase. when will the check be d
    7·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!