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61
26) Amunrud Corporation uses a job-order costing system to assign manufacturing costs to jobs.
At the end of the month it closes out any overapplied or underapplied manufacturing overhead to
Cost of Goods Sold. Its balance sheet on January 1 appears below:
Amunrud Corporation
Balance Sheet
January 1
Assets:
Cash
$12,000
Raw materials
$7,000
Work in process
11,000
Finished goods
16,000
34,000
Prepaid expenses
24,000
Property, plant, and equipment (net)
211,000
Total assets
$281,000
Liabilities and Stockholders' Equity:
Accounts payable
$14,000
Retained earnings
267,000
Total liabilities and stockholders' equity
$281,000
Summaries of the transactions completed during January appear below:
(1)
Raw materials purchased on account
$63,000
(2)
Raw materials used in production (direct materials)
$55,000
(3)
Raw materials used in production (indirect materials)
$9,000
(4)
Direct labor paid in cash
$97,000
(5)
Indirect labor paid in cash
$27,000
(6)
Selling and administrative salaries paid in cash
$31,000
(7)
Factory utility costs (on account)
$13,000
(8)
Depreciation on PP&E--manufacturing equipment
$7,000
(9)
Depreciation on PP&E--selling and administration
$3,000
(10)
Advertising expenses paid in cash
$15,000
(11)
Prepaid insurance expired--production
$6,400
(12)
Prepaid insurance expired--selling and administration
$1,600
(13)
Manufacturing overhead applied to production
$66,000
(14)
Cost of goods manufactured
$217,000
(15)
Cash sales
$289,000
(16)
Cost of goods sold
$228,000
(17)
Cash payments to creditors
$77,000
(18)
Overapplied (underapplied) overhead
?
62
Required:
Completely fill in the spreadsheet below. Because the page is too narrow to accommodate all of
the columns, the spreadsheet has been divided into two parts that should be side by side.
Transactions
Cash
Raw
Materials
Work in
Process
Beginning balances, January 1
(1)
Raw materials purchased on account
(2)
Raw materials used in production (direct
materials)
(3)
Raw materials used in production (indirect
materials)
(4)
Direct labor paid in cash
(5)
Indirect labor paid in cash
(6)
Selling and administrative salaries paid in
cash
(7)
Factory utility costs (on account)
(8)
Depreciation on PP&E--manufacturing
equipment
(9)
Depreciation on PP&E--selling and
administration
(10)
Advertising expenses paid in cash
(11)
Prepaid insurance expired--production
(12)
Prepaid insurance expired--selling and
administration
(13)
Manufacturing overhead applied to
production
(14)
Cost of goods manufactured
(15)
Cash sales
(16)
Cost of goods sold
(17)
Cash payments to creditors
(18)
Overapplied (underapplied) overhead
Ending balances at January 31
63
Finished
Goods
Manufact-
uring
Overhead
Prepaid
Expenses
PP&E (net)
=
Accounts
Payable
Retained
Earnings
=
(1)
=
(2)
=
(3)
=
(4)
=
(5)
=
(6)
=
(7)
=
(8)
=
(9)
=
(10)
=
(11)
=
(12)
=
(13)
=
(14)
=
(15)
=
(16)
=
(17)
=
(18)
=
66
27) Gilkison Corporation uses a job-order costing system to assign manufacturing costs to jobs.
At the end of the month it closes out any overapplied or underapplied manufacturing overhead to
Cost of Goods Sold. Its balance sheet on October 1 appears below:
Gilkison Corporation
Balance Sheet
October 1
Assets:
Cash
$10,000
Raw materials
$4,000
Work in process
13,000
Finished goods
17,000
34,000
Property, plant, and equipment (net)
212,000
Total assets
$256,000
Liabilities and Stockholders' Equity:
Accounts payable
$13,000
Retained earnings
243,000
Total liabilities and stockholders' equity
$256,000
Summaries of the transactions completed during October appear below:
(1)
Raw materials purchased on account
$93,000
(2)
Raw materials used in production (direct materials)
$75,000
(3)
Raw materials used in production (indirect materials)
$12,000
(4)
Direct labor paid in cash
$68,000
(5)
Indirect labor paid in cash
$27,000
(6)
Selling and administrative salaries paid in cash
$37,000
(7)
Factory utility costs (on account)
$13,000
(8)
Depreciation on PP&E--manufacturing equipment
$8,000
(9)
Depreciation on PP&E--selling and administration
$2,000
(10)
Advertising expenses paid in cash
$12,000
(11)
Manufacturing overhead applied to production
$61,000
(12)
Cost of goods manufactured
$203,000
(13)
Cash sales
$287,000
(14)
Cost of goods sold
$215,000
(15)
Cash payments to creditors
$109,000
(16)
Overapplied (underapplied) overhead
?
67
Required:
a. Completely fill in the spreadsheet below. Because the page is too narrow to accommodate all
of the columns, the spreadsheet has been divided into two parts that should be side by side.
Transactions
Cash
Raw
Materials
Work in
Process
Beginning balances, October 1
(1)
Raw materials purchased on account
(2)
Raw materials used in production (direct
materials)
(3)
Raw materials used in production (indirect
materials)
(4)
Direct labor paid in cash
(5)
Indirect labor paid in cash
(6)
Selling and administrative salaries paid in
cash
(7)
Factory utility costs (on account)
(8)
Depreciation on PP&E--manufacturing
equipment
(9)
Depreciation on PP&E--selling and
administration
(10)
Advertising expenses paid in cash
(11)
Manufacturing overhead applied to
production
(12)
Cost of goods manufactured
(13)
Cash sales
(14)
Cost of goods sold
(15)
Cash payments to creditors
(16)
Overapplied (underapplied) overhead
Ending balances at October 31
68
Finished
Goods
Manufact-
uring
Overhead
PP&E (net)
=
Accounts
Payable
Retained
Earnings
=
(1)
=
(2)
=
(3)
=
(4)
=
(5)
=
(6)
=
(7)
=
(8)
=
(9)
=
(10)
=
(11)
=
(12)
=
(13)
=
(14)
=
(15)
=
(16)
=
b. Prepare a Schedule of Cost of Goods Sold for the company for October.
c. Prepare an Income Statement for the company for October.
72
28) Wurzer Corporation uses a job-order costing system to assign manufacturing costs to jobs.
At the end of the month it closes out any overapplied or underapplied manufacturing overhead to
Cost of Goods Sold. Its balance sheet on January 1 appears below:
Wurzer Corporation
Balance Sheet
January 1
Assets:
Cash
$14,000
Raw materials
$6,000
Work in process
13,000
Finished goods
19,000
38,000
Property, plant, and equipment (net)
248,000
Total assets
$300,000
Liabilities and Stockholders' Equity:
Retained earnings
$300,000
Total liabilities and stockholders' equity
$300,000
Summaries of the transactions completed during January appear below:
(1)
Raw materials purchased for cash
$65,000
(2)
Raw materials used in production (direct materials)
$56,000
(3)
Raw materials used in production (indirect materials)
$12,000
(4)
Direct labor paid in cash
$96,000
(5)
Indirect labor paid in cash
$21,000
(6)
Selling and administrative salaries paid in cash
$33,000
(7)
Factory utility costs paid in cash
$14,000
(8)
Depreciation on PP&E--manufacturing equipment
$6,000
(9)
Depreciation on PP&E--selling and administration
$1,000
(10)
Advertising expenses paid in cash
$13,000
(11)
Manufacturing overhead applied to production
$56,000
(12)
Cost of goods manufactured
$207,000
(13)
Cash sales
$278,000
(14)
Cost of goods sold
$217,000
(15)
Overapplied (underapplied) overhead
?
73
Required:
a. Completely fill in the spreadsheet below. Because the page is too narrow to accommodate all
of the columns, the spreadsheet has been divided into two parts that should be side by side.
Transactions
Cash
Raw
Materials
Work in
Process
Beginning balances, January 1
(1)
Raw materials purchased for cash
(2)
Raw materials used in production (direct
materials)
(3)
Raw materials used in production (indirect
materials)
(4)
Direct labor paid in cash
(5)
Indirect labor paid in cash
(6)
Selling and administrative salaries paid in
cash
(7)
Factory utility costs paid in cash
(8)
Depreciation on PP&E--manufacturing
equipment
(9)
Depreciation on PP&E--selling and
administration
(10)
Advertising expenses paid in cash
(11)
Manufacturing overhead applied to
production
(12)
Cost of goods manufactured
(13)
Cash sales
(14)
Cost of goods sold
(15)
Overapplied (underapplied) overhead
Ending balances at January 31
74
Finished
Goods
Manufact-
uring
Overhead
PP&E (net)
=
Retained
Earnings
=
(1)
=
(2)
=
(3)
=
(4)
=
(5)
=
(6)
=
(7)
=
(8)
=
(9)
=
(10)
=
(11)
=
(12)
=
(13)
=
(14)
=
(15)
=
b. Prepare a Balance Sheet for the company for January 31.
c. Prepare a Schedule of Cost of Goods Manufactured for the company for January.
d. Prepare a Schedule of Cost of Goods Sold for the company for January.
e. Prepare an Income Statement for the company for January.
