9. (a) When direct factory labor is assigned to jobs, the entry is a debit to Work in Process Inventory and a credit to Factory Labor.
The other choices are incorrect because (b) Work in Process Inventory, not Manufacturing Overhead, is debited; (c) Work in Process Inventory, not Factory Labor, is debited and Factory Labor, not Manufacturing Overhead, is credited; and (d) Work in Process Inven- tory, not Factory Labor, is debited and Factory Labor, not Work in Process Inventory, is credited.
In Crawford Company, the predetermined overhead rate is 80% of direct labor cost. During the month, Crawford incurs $210,000 of factory labor costs, of which $180,000 is direct labor and $30,000 is indirect labor. Actual overhead incurred was $200,000. The amount of overhead debited to Work in Process Inven-
tory should be:
(a) $200,000.
(b) $144,000.
(c) $168,000.
(d)
$160,000.
For the year, Redder Company has cost of goods man- ufactured of $600,000, beginning finished goods inventory of $200,000, and ending finished goods inventory of $250,000. The cost of goods sold is:
(a) $450,000. (b) $500,000.
(c) $550,000. (d) $600,000.
(c) Cost of goods sold is computed as Beginning finished goods inventory ($200,000) 1 Cost of goods manufactured ($600,000) 2 Ending finished goods inventory ($250,000), or $200,000 1 $600,000 2 $250,000 5 $550,000.
Therefore, choices (a) $450,000, (b) $500,000, and (d) $600,000 are incorrect.
(b) The equivalent units of production is the sum of units completed and transferred out (20,000) and the equivalent units of ending work in process inventory (5,000 units 3 60%), or 20,000 1 3,000 5 23,000 units,
not (a) 22,600 units, (c) 24,000 units, or (d) 25,000 units.
Mora Company has 2,000 units in beginning work in
process, 20% complete as to conversion costs, 23,000 units transferred out to finished goods, and 3,000 units in ending work in process 3313 % complete as to conversion costs.The beginning and ending inventory is fully complete as to materials costs. Equivalent units for materials and conversion costs are, respectively:
(a) 22,000, 24,000. (c) 26,000, 24,000.
(b) 24,000, 26,000. (d) 26,000, 26,000.
(c) The equivalent units for materials are 26,000 (23,000 units transferred out plus 3,000 in ending work in process inventory). The equivalent units for conversion costs are 24,000 (23,000 transferred out plus 331y3% of the ending work in process inventory or 1,000).
Therefore, choices (a) 22,000, 24,000; (b) 24,000, 26,000; and (d) 26,000, 26,000 are incorrect.
(b) [(2,500 units 3 100% complete) 3 $10] 1 [(2,500 units 3 40% complete) 3 $30] or $25,000 1 $30,000 5 $55,000,
not
(a) $45,000, (c) $75,000, or (d) $100,000.
Hollins Company uses the FIFO method to compute equivalent units. It has 2,000 units in beginning work in process, 20% complete as to conversion costs, 25,000 units started and completed, and 3,000 units in ending work in process, 30% complete as to conver- sion costs. All units are 100% complete as to materials. Equivalent units for materials
and conversion costs are, respectively:
(a) 28,000 and 26,600.
(b) 28,000 and 27,500.
(c) 27,000 and 26,200.
(d) 27,000 and 29,600.
(b) The equivalent units for materials are 28,000 [25,000 started and completed 1 (3,000 3 100%)]. The equivalent units for conversion costs are 27,500 [(2,000 3 80%) 1 25,000 1 (3,000 3 30%)].
Therefore, choices (a) 28,000, 26,600; (c) 27,000, 26,200; and (d) 27,000, 29,600 are incorrect.
The job order cost sheets used by Greene Company revealed the following:
Job No. Bal., May 1 May Production Costs
134 $1,700 $0
135 1,200 300
136 0 900
Job No. 135 was completed during May and Jobs No. 134 and 135 were shipped to customers in May. What was the company's cost of goods sold for May and the Work in Process inventory on May 31?
rev: 09_29_2017_QC_CS-103208
$3,200; $900.
$2,900; $1,200.
$1,200;
$2,900.
$1,700; $1,200.
$4,100; $0.
Job A3B was ordered by a customer on September 25. During the month of September, Jaycee Corporation requisitioned $2,500 of direct materials and used $4,000 of direct labor. The job was not finished by the end of the month, but needed an additional $3,000 of direct materials and additional direct labor of $6,500 to finish the job in October. The company applies overhead at the end of each month at a rate of 200%
of the direct labor cost incurred. What is the balance in the Work in Process account at the end of September relative to Job A3B?
$5,500
$11,500
$6,500
$9,500
$14,500
A company's overhead rate is 60% of direct labor cost. Using the following incomplete accounts, determine the cost of direct materials used.
Work in Process Inventory Finished Goods Inventory
DR CR DR CR
Beg. Bal. 100,800 Beg. Bal. 118,200
D.M. ? 324,800
301,000
D.L. ?
O.H. ? F.G. ?
End. Bal. 131,040 End. Bal. 142,000
Factory Overhead
DR CR
93,240 90,720
$106,400.
$113,120.
$30,240.
$211,680.
$324,800.
Oxford Company uses a job order costing system. In the last month, the system accumulated labor time tickets total $24,600 for direct labor and $4,300 for indirect labor. These costs were accumulated in Factory Payroll as they were paid. Which entry should Oxford make to record the indirect labor used?
rev: 06_09_2015_QC_CS-17366, 11_27_2015_QC_CS-34729
Debit Payroll Expense $28,900; credit Cash $28,900.
Debit Payroll Expense $24,600; credit Factory Wages Payable $28,900.
Debit Factory Overhead $4,300; credit Factory Wages Payable $28,900.
Debit Work in Process Inventory $24,600; credit Wages Payable $28,900.
Debit Work in Process Inventory $28,900; credit Factory Wages Payable $28,900.
Andrew
Industries purchased $165,000 of raw materials on account during the month of March. The beginning Raw Materials Inventory balance was $22,000, and the materials used to complete jobs during the month were $141,000 direct materials and $13,000 indirect materials. How should Andrews journalize the purchase of raw materials for March?
Debit Raw Materials Inventory $165,000; credit Accounts Payable $165,000
Debit Work In Process Inventory $165,000; credit Raw Materials Inventory
$165,000
Debit Raw Materials Inventory $187,000; credit Cash $187,000
Debit Accounts Payable $165,000; credit Raw Materials Inventory $165,000
Debit Accounts Payable $187,000; credit Raw Materials Inventory $187,000
Adams Manufacturing allocates overhead to production on the basis of direct labor costs. At the beginning of the year, Adams estimated total overhead of $396,000; materials of $410,000 and direct labor of $220,000. During the year Adams
incurred $418,000 in materials costs, $413,200 in overhead costs and $224,000 in direct labor costs. Compute the amount of under- or overapplied overhead for the year.
$10,000 overapplied.
$17,200 overapplied.
$10,000 underapplied.
$17,200 underapplied.
$4,800 underapplied.