Wild and Shaw, Financial and Managerial Accounting 9e Solutions Manual: Chapter 15
935
Chapter 15
Job Order Costing
QUICK STUDIES
Quick Study 15-1 (5 minutes)
Quick Study 15-2 (5 minutes)
Quick Study 15-3 (10 minutes)
a.
Finished Goods Inventory ………………………..
10,500
Work in Process Inventory …………………..
10,500
Sales ………………………………………………….
14,900
10,500
Finished Goods Inventory …………………..
10,500
Wild and Shaw, Financial and Managerial Accounting 9e Solutions Manual: Chapter 15
936
Quick Study 15–4 (10 minutes)
1.
JOB COST SHEET
Direct materials …………………………..
$ 600
Quick Study 15-5 (10 minutes)
1.
JOB COST SHEET Job 202
Direct materials ($43,750 + $25,250) ….
$ 69,000
Overhead …………………………………..
2. Cost per unit completed = Total job lot cost / Number of units completed
= $225,000 / 2,500 units = $90 per unit
Quick Study 15-6 (10 minutes)
a.
Raw Materials Inventory …………………………..
50,000
Cash …………………………………………………..
50,000
Record raw material purchases.
12,000
c.
32,000
Raw Materials Inventory ……………………..
32,000
Wild and Shaw, Financial and Managerial Accounting 9e Solutions Manual: Chapter 15
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Quick Study 15-7 (10 minutes)
a.
Work in Process Inventory ……………………….
150,000
Quick Study 15-8 (10 minutes)
Predetermined overhead rate = Estimated overhead cost / Estimated activity base
1. Estimated overhead cost / Estimated direct labor
$117,000 / $468,000 = 25%
Quick Study 15-9 (10 minutes)
Quick Study 15–10 (5 minutes)
Wild and Shaw, Financial and Managerial Accounting 9e Solutions Manual: Chapter 15
Quick Study 15–11 (10 minutes)
Overhead Applied
Job 1 ($5,000 x 40%) …………
$2,000
Job 3 ($1,500 x 40%) …………
Quick Study 15-12 (10 minutes)
2. Overhead applied = 50 DL hours used x $30 per DLH = $1,500
Quick Study 15-13 (10 minutes)
a.
Factory Overhead ………………………………………….
6,200
Raw Materials Inventory …………………………..
6,200
Record indirect materials used.
Factory Overhead ………………………………………….
9,000
Factory Wages Payable …………………………...
9,000
Record indirect labor used.
Factory Overhead ………………………………………….
13,300
12,000
Prepaid Insurance …………………………………….
Quick Study 15–14 (10 minutes)
a.
Finished Goods Inventory ……………………………..
27,000
Work in Process Inventory ……………………….
27,000
Record costs of completed Jobs 103 and 104.
20,000
Sales ……………………………………………………….
20,000
Record sale of Job 103.
12,000
12,000
Wild and Shaw, Financial and Managerial Accounting 9e Solutions Manual: Chapter 15
939
Quick Study 15–15 (10 minutes)
1. Total applied overhead cost
= Credit amount in the Factory Overhead account
3.
Actual overhead ……………………….
Applied overhead ……………………..
Quick Study 15–16 (10 minutes)
1.
JOB COST SHEET — Job 1
Direct materials ……………………………..
Direct labor ……………………………………
$ 5,000
9,000
Overhead (60% of DM used) ……………..
3,000
Total ………………………………………………
$17,000
JOB COST SHEET — Job 2
Overhead (60% of DM used) ……………..
4,200
JOB COST SHEET — Job 3
Overhead (60% of DM used) ……………..
900
Total ………………………………………………
2. Work in Process Inventory
= Sum of total costs on job cost sheets for jobs that remain unfinished
at period-end (Job 1 and Job 3).
= $22,400. ($17,000 + $5,400)
Wild and Shaw, Financial and Managerial Accounting 9e Solutions Manual: Chapter 15
Quick Study 15-17 (10 minutes)
SHEN COMPANY
Schedule of Cost of Goods Manufactured
For Month Ended May 31
Direct materials used …………………………………………………………..
$2,500
Direct labor …………………………………………………………………………
2,300
Total manufacturing costs …………………………………………………..
7,800
Add: work in process inventory, beginning ………………………….
Total cost of work in process ……………………………………………….
7,800
Less: work in process inventory, ending (Job 5)** ………………..
(2,400)
Quick Study 15-18 (10 minutes)
1.
Actual overhead ………………………………………………………
$950,000
Applied overhead (150% of direct labor cost)* ………….
2.
Cost of Goods Sold ………………………………………..
50,000
Wild and Shaw, Financial and Managerial Accounting 9e Solutions Manual: Chapter 15
Quick Study 15-19 (10 minutes)
1.
Actual overhead (debits in Factory Overhead account) …………….
$624,000
Applied overhead (credits in Factory Overhead account) ………….
2.
Factory Overhead …………………………………..
Quick Study 15–20 (10 minutes)
1.
Actual overhead*……………………………………………………….
$400,000
Applied overhead ……………………………………………………….
2.
Factory Overhead …………………………………..
4,000
4,000
Quick Study 15–21 (10 minutes)
1.
Actual overhead* …………………………………………………….
$395,000
Applied overhead ……………………………………………………
2.
Cost of Goods Sold ………………………………….
5,000
5,000
Wild and Shaw, Financial and Managerial Accounting 9e Solutions Manual: Chapter 15
Quick Study 15–22 (10 minutes)
1.
ESTIMATED JOB COST SHEET
Direct labor ($50 x 200 DLH)….
Overhead ($65 x 200 DLH) …….
2.
PRICE QUOTE
Total cost …………………………..
$23,000
Markup (20%) ………………………
Quick Study 15–23 (10 minutes)
1.
ESTIMATED JOB COST SHEET
Direct labor ($50 x 60 DLH) …..
$3,000
Overhead ($40 x 60 DLH) ………
2.
PRICE QUOTE
Total cost …………………………..
$5,400
Markup (10%) ………………………
Quick Study 15–24 (5 minutes)
1.
Gross profit ratio
Sales ……………………………………………………….
$80,000
Cost of goods sold ………………………………………
2. Favorably. This manufacturer’s 25% gross profit ratio exceeds the 10%
average of peers.
Wild and Shaw, Financial and Managerial Accounting 9e Solutions Manual: Chapter 15
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EXERCISES
Exercise 15-1 (10 minutes)
Exercise 15-2 (15 minutes)
JOB COST SHEET: Job 9
Direct Materials
Direct Labor
Overhead
Date
Requisition
No.
Cost
Time
Ticket
Cost
Date
Cost
July 1
M-46
$1,250
T-33
$600
July
$1,400
July 5
M-47
T-34
July 10
T-35
1,350
$2,250
Total
Wild and Shaw, Financial and Managerial Accounting 9e Solutions Manual: Chapter 15
944
Exercise 15-3 (15 minutes)
1. $75,000. Total cost of direct materials requisitioned in June equals the
sum of the direct materials costs from all three jobs.
Job 102 …………………………………………………………
Job 103 …………………………………………………………
Job 104 …………………………………………………………
2. $43,200. Total cost of direct labor used in June equals the sum of the
direct labor costs from all three jobs.
Job 102 …………………………………………………………
Job 103 …………………………………………………………
Job 104 …………………………………………………………
3. $81,300. Total cost transferred to Finished Goods Inventory in June
equals the total costs of the two completed jobs (Jobs 102 and 103) for
the month.
Job 102
Job 103
Total
Direct materials ………………….
$15,000
$33,000
$48,000
Overhead …………………………...
Wild and Shaw, Financial and Managerial Accounting 9e Solutions Manual: Chapter 15
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Exercise 15–4 (15 minutes)
1.
Job 1
Job 2
Direct materials ……………………….
$ 425
$ 403
Direct labor ……………………………..
750
780
Total job lot cost ………………………
2.
Job 1
Job 2
Direct materials ……………………….
$ 425
$ 403
Units produced ………………………….
250
260
Wild and Shaw, Financial and Managerial Accounting 9e Solutions Manual: Chapter 15
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Exercise 15-5 (10 minutes)
1.
Raw Materials Inventory ……………………………….
100,000
100,000
2.
Work in Process Inventory …………………………...
80,000
3.
Factory Overhead …………………………………………
15,000
Exercise 15–6 (15 minutes)
1.
JOB COST SHEETS
Job No. 201
Job No. 202
Materials …….
$ 48,200
Materials ……
$23,600
2. Gross profit on sale of job 201.
Job 201
Sales …………………………….
$163,760
Wild and Shaw, Financial and Managerial Accounting 9e Solutions Manual: Chapter 15
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Exercise 15-7 (25 minutes)
a.
Raw Materials Inventory ……………………………….
100,000
Accounts Payable ……………………………………
100,000
Record materials purchases.
Work in Process Inventory …………………………...
71,800
Raw Materials Inventory ………………………….
71,800
Record direct materials used.
Factory Overhead …………………………………………
8,620
Raw Materials Inventory ………………………….
8,620
Record indirect materials used.
c.
Work in Process Inventory …………………………...
51,800
Factory Wages Payable …………………………...
51,800
Record direct labor used.
Factory Overhead …………………………………………
24,200
Factory Wages Payable …………………………...
24,200
Record indirect labor used.
d.
Work in Process Inventory …………………………...
57,440
Factory Overhead ……………………………………
57,440
Finished Goods Inventory …………………………….
Work in Process Inventory ………………………
Accounts Receivable ……………………………………
Sales ………………………………………………………
Finished Goods Inventory ……………………….
g.
Factory Overhead …………………………………………
36,300
Accumulated Depreciation-Factory Equip. ..
32,000
Rent Payable ……………………………………………
500
Utilities Payable ……………………………………….
800
Prepaid Insurance ……………………………………
3,000
Record other actual factory overhead costs.
Wild and Shaw, Financial and Managerial Accounting 9e Solutions Manual: Chapter 15
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Exercise 15–8 (20 minutes)
GENERAL LEDGER ACCOUNTS
Raw Materials Inventory
(a)
100,000
(b)
71,800
8,620
Bal.
19,580
71,800
(d)
57,440
51,800
Exercise 15-9 (15 minutes)
1.
Raw Materials Inventory ……………………………….
76,200
Accounts Payable ……………………………………
76,200
2.
Work in Process Inventory …………………………...
48,000
Raw Materials Inventory ………………………….
48,000
Record direct materials used.
3.
Work in Process Inventory …………………………...
15,350
Factory Wages Payable …………………………..
15,350
Record direct labor used.
4.
Work in Process Inventory …………………………...
18,420
Factory Overhead …………………………………..
18,420
Apply overhead to jobs [$15,350 x 120%].
Wild and Shaw, Financial and Managerial Accounting 9e Solutions Manual: Chapter 15
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Exercise 15-10 (20 minutes)
1.
a.
Work in Process Inventory …………………………...
9,500
Raw Materials Inventory ………………………….
9,500
Record direct materials used.
b.
8,000
Factory Wages Payable …………………………..
8,000
c.
Work in Process Inventory …………………………...
6,400
Factory Overhead ……………………………………
6,400
d.
Accounts Receivable ……………………………………
22,000
Sales ………………………………………………………
22,000
Record sale of job 120.
e.
Finished Goods Inventory ……………………….
2. Work in Process Inventory at July 31 = $6,280 (see computations below).
Explanation: Equals the total cost reported on the job cost sheet for Job
122, the only job still in process at July 31.
Finished Goods Inventory at July 31 = $12,660 (see computations below).
Wild and Shaw, Financial and Managerial Accounting 9e Solutions Manual: Chapter 15
Exercise 15-11 (20 minutes)
1.
Raw Materials Inventory
Beginning
38,000
43,250
Direct materials
Purchases
18,460
9,300
Indirect materials
Ending
3,910
Work in Process Inventory
Beginning
12,400
Direct materials
43,250
22,800
Overhead applied*
34,600
manufactured
Ending
17,760
Beginning
manufactured
95,290
Ending
20,840
2.
Actual overhead cost ($9,300+$16,400+$4,300) …….
$30,000
$34,600
951
Exercise 15-12 (30 minutes)
NOTE: Shaded amounts must be solved for.
1.
Raw Materials Inventory
Beginning
43,000
Purchases
Direct materials
2.
3.
Work in Process Inventory
Beginning
10,200
Direct materials
Direct labor
applied*
manufactured
4.
Finished Goods Inventory
Beginning
63,000
manufactured
Cost of goods sold
5.
Factory Overhead
Indirect materials
15,000
185,500
Applied
Indirect labor
overhead
Wild and Shaw, Financial and Managerial Accounting 9e Solutions Manual: Chapter 15
Exercise 15–13 (10 minutes)
1.
Raw Materials Inventory ………………………..
210,000
Cash ……………………………………………….
210,000
2.
Work in Process Inventory ……………………
186,000
Raw Materials Inventory …………………..
186,000
3.
Factory Overhead …………………………………
15,000
Raw Materials Inventory …………………..
15,000
Exercise 15–14 (10 minutes)
1.
Work in Process Inventory ……………………
265,000
Factory Wages Payable ……………………
265,000
2.
Factory Overhead …………………………………
80,000
Factory Wages Payable ……………………
80,000
Exercise 15-15 (10 minutes)
1.
Factory Overhead …………………………………
120,000
Cash ……………………………………………….
120,000
2.
Work in Process Inventory ……………………
185,500
Factory Overhead …………………………...
185,500
Wild and Shaw, Financial and Managerial Accounting 9e Solutions Manual: Chapter 15
Exercise 15-16 (20 minutes)
1.
a. $24,250 = Direct materials used (see credit to Raw Materials Inventory
and debit to Work in Process Inventory).
b. $8,000 = Indirect materials used (see credit to Raw Materials Inventory
and debit to Factory Overhead).
Exercise 15-17 (15 minutes)
1.
Rate = = = 130%
2.
Direct materials …………………….
$15,640
Estimated overhead costs
Estimated direct labor
$747,500
$575,000
Direct labor …………………………..
$23,000
Wild and Shaw, Financial and Managerial Accounting 9e Solutions Manual: Chapter 15
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Exercise 15-18 (25 minutes)
a.
Raw Materials Inventory ……………………………….
90,000
Accounts Payable …………………………………..
90,000
Record materials purchases.
Work in Process Inventory …………………………...
36,500
Raw Materials Inventory ………………………….
36,500
Record direct materials used.
Factory Overhead …………………………………………
19,200
Raw Materials Inventory ………………………….
19,200
Record indirect materials used.
c.
Work in Process Inventory …………………………...
38,000
Factory Wages Payable ………………………….
38,000
Record direct labor used.
Factory Overhead …………………………………………
12,000
Factory Wages Payable ………………………….
12,000
Record indirect labor used.
Cash ………………………………………………………
11,475
e.
Work in Process Inventory …………………………...
47,500
Factory Overhead ……………………………………
47,500
f.
Finished Goods Inventory …………………………….
56,800
Work in Process Inventory ………………………
56,800
Record jobs completed.
g.
Accounts Receivable ……………………………………
82,000
Sales ………………………………………………………
82,000
Record sale of job.
h.
56,800
Finished Goods Inventory ……………………….
56,800