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Cost Accounting_ Three Questions




Question;Problem 1;Mariya;Company uses a job-order costing system and applies manufacturing overhead cost;to jobs on the basis of the cost of direct materials used in production. Its;predetermined overhead rate was based on a cost formula that estimated $221,200;of manufacturing overhead for an estimated allocation base of $158,000 direct;material dollars. The following transactions took place during the year (all;purchases and services were acquired on account);a. Raw materials purchased, $145,000.;b. Raw materials requisitioned for use in;production (all direct materials), $141,000.;c. Utility bills incurred in the factory;$24,000.;d. Costs for salaries and wages were;incurred as follows;Direct;labor;$223,000;Indirect;labor;$61,700;Selling;and administrative salaries;$143,000;e. Maintenance costs incurred in the;factory, $17,000.;f. Advertising costs incurred, $128,000.;g. Depreciation recorded for the year;$43,000 (70% relates to factory assets, and the remainder relates to selling;and administrative assets).;h. Rental cost incurred on buildings;$85,000 (80% of the space is occupied by the factory, and 20% is occupied by;sales and administration).;i. Miscellaneous selling and;administrative costs incurred, $11,000.;j. Manufacturing overhead cost was;applied to jobs, $?;k. Cost of goods manufactured for the;year, $555,000.;l. Sales for the year (all on account);totaled $1,100,000. These goods cost $530,000 according to their job cost;sheets.;The;balances in the inventory accounts at the beginning of the year were as;follows;Raw;materials;$23,000;Work;in process;$24,000;Finished;Goods;$34,000;Required;a. Using the above;data, prepare the following eight journal entries;1. To record the purchase of raw materials;2. To;transfer cost of raw materials to production, record direct labor costs, and;apply overhead to work in process inventory;3. To;transfer cost of completed units to finished goods inventoryj;4. To;record sales;5. To;transfer cost of finished goods to cost of goods sold;6. To;record factory overhead costs;7. To;transfer over- or underapplied overhead to cost of goods sold;8. To;record selling and administrative expenses;As these are summary journal entries;for an entire accounting period, no dates are given. Use the number of the journal entry in place;of a date on the general journal page.;All of the information needed to correctly record the entries is;provided. However, you may find it;useful to prepare t-accounts on scratch paper to help you determine the correct;debits and credits for some entries.;b. Job 521 was one of the many jobs;started and completed during the year. The job required $3,900 in direct;materials and 400 hours of direct labor time at a rate of $14 per hour. If the;job contained 540 units and the company billed at 65% above the unit product cost;on the job cost sheet, what price per unit would have been charged to the;customer?;Problem 2;Broucek Inc.;makes baby furniture from fine hardwoods. The company uses a job-order costing;system and;predetermined overhead rates to apply manufacturing overhead cost to jobs. The;predetermined;overhead rate in the Preparation Department is based on machine hours, and;the rate in the;Fabrication Department is based on direct labor-hours. At the beginning of the;year, the;company?s management prepared the following information for the year. All figures;are estimates;except the fixed overhead and variable overhead rates, which are actual figures;from last year;and remain the same this year. In other;words, it is machine-hours and direct;labor-hours that;are estimated and used with fixed overhead and variable overhead per;machine-hour and;per direct labor-hour in order to calculate rates for applying overhead.;Department;Preparation;Fabrication;Machine-hours;83,000;32,000;Direct;labor-hours;33,000;57,000;Direct;materials cost;$194,000;$204,000;Direct;labor cost;$280,000;$521,000;Fixed;manufacturing overhead cost;$207,500;$518,700;Variable;manufacturing overhead per machine-hour;$3.00;?;Variable;manufacturing overhead per direct labor-hour;?;$5.00;Job 135 was;started on April 1 and completed on May 12. The company's cost records show the;following information concerning the job;Department;Preparation;Fabrication;Machine-hours;360;67;Direct;labor-hours;80;133;Direct;materials cost;$940;$1,120;Direct;labor cost;$690;$970;Required;a. Compute the;predetermined overhead rate used during the year in the Preparation Department.;Compute the rate used in the Fabrication;Department.;b. Compute the;total overhead cost applied to Job 135.;c. What would be;the total cost recorded for Job 135? If the job contained 29 units, what would;be the unit product cost?;d. At the end of the year, the records of;Broucek Inc. revealed the following actual cost and operating data for all jobs;worked on during the year;Department;Preparation;Fabrication;Machine-hours;82,700;24,800;Direct;labor-hours;28,000;53,000;Direct;materials cost;$165,800;$412,000;Direct;labor cost;$464,550;$711,400;What was the amount of;underapplied or overapplied overhead in each department at the end of the year?;Problem 3;VitalVitamin is produced in;a three-step process consisting of mixing, shaping, and packaging. Direct materials like tars, acids, and inert;ingredients are all introduced at the beginning of the mixing cycle;at a per unit cost of $0.30. Direct;labor and factory overhead are incurred uniformly throughout each stage of;production, and in equal proportion (i.e., $1 of overhead for each $1 of;labor). Costs are very stable, and;there have been no changes in per unit costs for any element of production;over the past several months.;Information for the Mixing Department for the month of April, 2011;follows.;Beginning of April: 100,000 units in process (40% complete at;a total cost of $50,000);During April: 800,000 units put into;production, additional costs into production;total;$652,500;End of April: 70,000 units in process (50%;complete).;Required;a.;Prepare a cost of production report for the;Mixing Department for April. Use the;weighted-average costing method.;b.;Prepare April?s journal entries that affect the;Mixing Department?s Work in Process account (two entries).


Paper#37196 | Written in 18-Jul-2015

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