2024 – Part I Introduction 2 slides 1 Introduce your Team and overview

1.  

Purchased additional raw materials of $40,000 on account.

2.  

Incurred factory labor costs of $31,500. Of this amount $7,500 related to employer payroll taxes.

3.  

Incurred manufacturing overhead costs as follows: indirect materials $10,000; indirect labor $7,500; depreciation expense $12,000; and various other manufacturing overhead costs on account $11,000.

4.  

Assigned direct materials and direct labor to jobs as follows.

5.  

The company uses direct labor hours as the activity base to assign overhead. Direct labor hours incurred on each job were as follows: Job No. 25, 200; Job No. 26, 800; and Job No. 27, 600.

(a)  

Calculate the predetermined overhead rate for the year 2011, assuming Weinrich Manufacturing estimates total manufacturing overhead costs of $480,000, direct labor costs of $300,000, and direct labor hours of 20,000 for the year.

(b)  

Open job cost sheets for Jobs 25, 26, and 27. Enter the January 1 balances on the job cost sheet for Job No. 25.

(c)  

Prepare the journal entries to record the purchase of raw materials, the factory labor costs incurred, and the manufacturing overhead costs incurred during the month of January.

(d)  

Prepare the journal entries to record the assignment of direct materials, direct labor, and manufacturing overhead costs to production. In assigning manufacturing overhead costs, use the overhead rate calculated in (a). Post all costs to the job cost sheets as necessary.

(e)  

Total the job cost sheets for any job(s) completed during the month. Prepare the journal entry (or entries) to record the completion of any job(s) during the month.

Job 25, $37,800

  Job 26, $48,200

(f)  

Prepare the journal entry (or entries) to record the sale of any job(s) during the month.

(g)  

What is the balance in the Work in Process Inventory account at the end of the month? What does this balance consist of?

(h)  

What is the amount of over- or underapplied overhead?