Sager Company builds custom retaining walls for large commercial customers. On May 1, the company had no
Question:
Sager Company builds custom retaining walls for large commercial customers. On May 1, the company had no inventories of work in process or finished goods but held the following raw materials.
On May 4, the company began work on Job 102 for Woz Company and Job 103 for Reuben Company.
Required
1. Prepare job cost sheets for Jobs 102 and 103 using the layout in Exhibit 19.3, and prepare three materials ledger cards for cinder blocks, boulders, and stain using the layout in Exhibit 19.5. Enter the beginning raw materials inventory amounts from above for each of these materials on their ledger cards. Then, follow the instructions in this list of activities to complete the job cost sheets and the materials ledger cards.
a. Purchased raw materials on credit and recorded the following information from receiving reports.
Instructions:
Enter the receiving report information on the materials ledger cards.
b. Requisitioned the following raw materials for production.
Instructions:
Enter amounts for direct materials requisitions on the materials ledger cards and the job cost sheets. Enter the indirect materials amount on the materials ledger card.
c. Received the following employee time tickets for work in May.
Instructions:
Record direct labor from the time tickets on the job cost sheets.
d. Finished Job 102. The company applies overhead to each job with a predetermined overhead rate of 80% of direct labor cost.
Instructions:
Enter the applied overhead on the cost sheet for Job 102, fill in the cost summary section of the cost sheet, and then mark the cost sheet “Finished.”
e. Applied overhead cost to Job 103 based on the job’s direct labor used to date.
Instructions:
Enter applied overhead on the job cost sheet for Job 103.
2. Job 102 was sold on credit for $400,000. Compute gross profit for the month.
3. Determine the balances reported on the month-end balance sheet for Raw Materials Inventory and Work in Process Inventory.
Exhibit 19.3
Step by Step Answer:
1 2 3 From materials ledger cards 61250 13500 3000 77750 From Job 103 cost sheet 17500 6840 ...View the full answer
