Work in Process Inventory
Manufacturing Overhead
Factory Labor
Manufacturing Overhead
Sales Revenue
P20-3A Solution
(a)(1) Journalize the June transactions for purchase of raw materials, factory labor costs incurred,
and manufacturing overhead costs incurred
4,900
4,900
(a)(2) Journalize the June transactions for assignment of direct materials, labor, and overhead to production
4,900
1,500
6,400
(a)(3) Journalize the June transactions for completion of jobs and sale of goods.
14,740
14,740
Direct Direct Manufacturing Total
Job Materials labor Overhead Costs
Rodgers $1,700 $1,560 $1,950 $5,210
(b) Post the entries to Work in Process Inventory.
Work in Process Inventory
Work in Process Inventory
Manufacturing Overhead
Raw Materials Inventory
Finished Goods Inventory
Work in Process Inventory
Raw Materials Inventory
Accounts Payable
Accounts Payable
Accumulated Depreciation – Equipment
Factory labor
Manufacturing Overhead
6/1 Balance 5,540 June Completed work 14,740
(c ) Reconcile the balance in Work in Process Inventory with the costs of unfinished jobs.
Work in Process Inventory $3,800
Unfinished Job (Koss)
Direct materials 2,000
(d) Prepare a cost of goods manufactured schedule for June.
Work in process, June 1 $5,540
Direct materials used $4,900
For the Month Ended June 30, 2017
CASE INC.
Cost of Goods Manufactured Schedule
Manufacturing Overhead
P20-3A Solution to additional question
1. Assume that indirect labor and raw materials purchases changed to $1,400 and $6,800 respectively.
Also assume that overhead is applied at the rate of $1.50 per dollar of direct labor. The three
completed jobs were sold for $22,000 cash. Revise the journal entries to reflect these changes.
(a)(1) Journalize the June transactions for purchase of raw materials, factory labor costs incurred,
and manufacturing overhead costs incurred
6,800
6,800
(a)(2) Journalize the June transactions for assignment of direct materials, labor, and overhead to production
4,900
1,500
6,400
(a)(3) Journalize the June transactions for completion of jobs and sale of goods.
15,800
15,800
Direct Direct Manufacturing Total
Job Materials labor Overhead* Costs
Rodgers $1,700 $1,560 $2,340 $5,600
22,000
22,000
Sales Revenue
Work in Process Inventory
Accounts Payable
Raw Materials Inventory
Factory labor
Cash
Manufacturing Overhead
Accumulated Depreciation – Equipment
Accounts Payable
P20-5A Analyze manufacturing accounts and determine missing amounts
Phillips Corporation’s fiscal year ends on November 30. The following accounts are found in its job
order cost accounting system for the first month of the new fiscal year.
Dec. 1 Beginning balance (a) Dec. 31 Requisitions $16,850
31 Purchases 17,225
Dec.31 Ending balance 7,975
Dec. 1 Beginning balance (b) Dec. 31 Jobs completed (f)
31 Direct materials (c)
31 Direct labor 8,400
31 Overhead (d)
Dec. 31 Ending balance (e)
Dec. 1 Beginning balance (g) Dec. 31 Cost of goods sold (i)
Dec. 31 Jobs completed (h)
Dec. 31 Ending balance (j)
Dec. 31 Factory wages 12,025 Dec. 31 Wages assigned (k)
Dec. 31 Indirect materials 2,900 Dec. 31 Overhead applied (m)
31 Indirect labor (l)
31 Other overhead 1,245
Other data:
1. On December 1, two jobs were in process: Job No. 154 and Job No.155. These jobs had combined direct
materials costs of $9,750 and direct labor costs of $15,000. Overhead was applied at a rate that was 75%
of direct labor cost.
2. During December, Job Nos. 156, 157 and 158 were started. On December 31, Job No. 158 was unfinished.
This job had charges for direct materials $3,800 and direct labor $4,800 plus manufacturing overhead. All
jobs, except for Job No. 158, were completed in December.
3. On December 1, Job No. 153 was in the finished goods warehouse. It had a total cost of $5,000. On
December 31, Job No. 157 was the only job finished that was not sold. It had a cost of $4,000.
4. Manufacturing overhead was $1,470 underapplied in December.
Instructions
List the items (a) through (m) and indicate the amount pertaining to each letter.
NOTE: Enter a number in cells requesting a value; enter either a number or a formula in cells with a “?” .
(a) Beginning balance, raw materials
Total requisitions Value
Ending balance, raw materials Value
Less: purchases Value
Beginning balance, raw materials ?
(b) Beginning work in process (Job 154 & Job 155)
Direct materials Value
Direct labor Value
Overhead applied ?
?
(c ) Direct materials
Raw Materials Inventory
Work in Process Inventory
Finished Goods Inventory
Factory Labor
Manufacturing Overhead
Requisitions of raw materials Value
Less: indirect materials Value
Direct materials ?
(d) Overhead applied
Direct labor Value
Overhead applied ?
(75% of DL)
(e) Ending work in process (Job No. 158)
Direct materials Value
Direct labor Value
Overhead applied ?
?
(f) Completed Jobs (Jobs 154 -157)
Beginning balance, work in process Value
Direct materials Value
Direct labor Value
Overhead applied Value
Less: ending work in process Value
Jobs completed ?
(g) Beginning balance, finished goods (Job 153) Value
(h) Jobs completed Value
(i) Cost of goods sold
Beginning finished goods Value
Jobs completed Value
Less: ending finished goods Value
Cost of goods sold ?
(j) Ending finished goods (Job 157) Value
(k) Wages assigned to work in process Value
(l) Indirect labor
Factory wages Value
Less: direct labor Value
Indirect labor Value
(m) Overhead applied
Direct labor Value
Overhead applied ?
When you have completed P20-5A, consider the following additional question.
1. Assume that requisitions changed to $17,600. Show the impact of this
change on the items listed.
P20-5A Solution
(a) Beginning balance, raw materials
Total requisitions $16,850
Ending balance, raw materials $7,975
(b) Beginning work in process (Job 154 & Job 155)
Direct materials $9,750
Direct labor 15,000
(c ) Direct materials
Requisitions of raw materials $16,850
(d) Overhead applied
Direct labor $8,400
(e) Ending work in process (Job No. 158)
Direct materials $3,800
Direct labor 4,800
(f) Completed Jobs (Jobs 156 & 157)
Beginning balance, work in process $36,000
Direct materials 13,950
(g) Beginning balance, finished goods (Job 153) $5,000
(j) Ending finished goods (Job 157) $4,000
P20-5A Solution to additional question
1. Assume that requisitions changed to $17,600. Show the impact of this
change on the items listed.
(a) Beginning balance, raw materials
Total requisitions $17,600
(b) Beginning work in process (Job 154 & Job 155)
Direct materials $9,750
Direct labor 15,000
(c ) Direct materials
Requisitions of raw materials $17,600
(d) Overhead applied
Direct labor $8,400
Overhead applied $6,300
(e) Ending work in process (Job No. 158)
Direct materials $3,800
(f) Completed Jobs (Jobs 156 & 157)
Beginning balance, work in process $36,000
Direct materials 14,700
(g) Beginning balance, finished goods (Job 153) $5,000
(h) Jobs completed $53,200 See (f) above
(i)
Cost of goods sold
Beginning finished goods $5,000
(j) Ending finished goods (Job 157) $4,000
(l) Indirect labor
Factory wages $12,025
CD20 – Excel Tutorial
CURRENT DESIGNS
Juegel Hollow Resort has ordered 20 rotomolded kayaks from Current Designs. Each kayak will be formed in
the rotomolded oven, cooled, and then the excess plastic trimmed away. Then, the hatches, seat, ropes, and bungees
will be attached to the kayak.
Dave Thill, the kayak plant manager, knows that manufacturing each kayak requires 54 pounds of polyethylene
powder and a finishing kit (rope, seat, hardware, etc.). The polyethylene powder used in these kayaks cost $1.50 per
pound, and the finishing kits cost $170 each. Each kayak will use two kinds of labor: 2 hours of more-skilled type I
labor from people who run the oven and trim the plastic, and 3 hours of less-skilled type II labor from people who attach the
hatches and seat and other hardware. The type I employees are paid $15 per hour, and the type II employees are paid $12 per
hour. For purposes of this problem, assume that overhead is allocated to all jobs at a rate of 150% of direct labor costs.
Instructions
Determine the total cost of the Huegel Hollow order and the cost of each individual kayak in the order. Identify costs as
direct materials, direct labor, or manufacturing overhead.
NOTE: Enter a number in cells requesting a value; enter either a number or a formula in cells with a “?” .
Cost for one kayak:
Direct Materials
Polyethylene powder ?
Finishing kit ?
Direct Labor
More skilled ?
Less skilled ?
Manufacturing overhead ?
Total cost of one kayak ?
Cost for order of 20 kayaks:
Cost per unit x 20 units ?
After you have completed CD2, consider the following additional question.
1. Assume that each kayak requires 60 lbs of polyethylene and cost of finishing kit changed to $180 per kit. Also
assume that overhead is allocated to all jobs at a rate of 180% of direct labor costs. Show the impact of these changes.
CD20 – Solution
Cost for one kayak:
Direct Materials
Polyethylene powder 54 pounds @ $1.50 per pound $81
Finishing kit 1 kit @ $170 170
Direct Labor
Cost for order of 20 kayaks:
CD20- Solution to additional question
1. Assume that each kayak requires 60 lbs of polyethylene and cost of finishing kit changed to $180 per kit. Also
assume that overhead is allocated to all jobs at a rate of 180% of direct labor costs. Show the impact of these changes.
Cost for one kayak:
Direct Materials
Polyethylene powder
60 pounds @ $1.50 per pound $90
Finishing kit
1 kit @ $180 180
Direct Labor
180% of direct labor costs 118.80