Question: Potomac Automotive Co manufactures engines that are made only on

Potomac Automotive Co. manufactures engines that are made only on customers’ orders and to their specifications. During January, the company worked on Jobs 007, 008, 009, and 010. The following figures summarize the cost records for the month:
Jobs 007 and 008 have been completed and delivered to the customer at a total selling price of $426,000, on account. Job 009 is finished but has not yet been delivered. Job 010 is still in process.
There were no materials or work in process inventories at the beginning of the month. Material purchases were $115,000, and there were no indirect materials used during the month.
1. Prepare a summary showing the total cost of each job completed during the month or in process at the end of the month.
2. Prepare the summary journal entries for the month to record the distribution of materials, labor, and overhead costs.
3. Determine the cost of the inventories of completed engines and engines in process at the end of the month.
4. Prepare the journal entries to record the completion of the jobs and the sale of the jobs.
5. Prepare a statement of cost of goods manufactured.

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  • CreatedMarch 31, 2015
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