Quality Painters, Inc., uses a job cost system. As of January 1, its records showed the...

   

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Quality Painters, Inc., uses a job cost system. As of January 1, its records showed the following inventory balances; Materials Work in process $50,000 (consisting of Job 100 $30,000 and $12,000 Job 101 $20,000) Finished goods So (no jobs were finished and unsold as of Jan 1) Here are data for the company in January: a Materials purchased, $85,000. b. Direct materials used: direct materials for Job No. 100, $15,500; for Job No. 101, $28,500; and for Job No. 102 (a new job), $48,000. c Supplies (indirect materials) used amounted to $5,500. d. Direct labor costs: direct labor to Job No. 100, $22,500; to Job No. 101, $40,000, and to Job No. 102, $50,000. e. Indirect labor, $22,500. f Overhead is assigned to jobs at $8 per labor-hour, with 500 labor-hours to Job 100 and 2,500 labor-hours each to Jobs 101 and 102. g. Jobs 100 and 102 were completed in January (Job 101 was not finished) h Sales revenues for January were $250,000 for Job 100 (Job 102 has not been sold) 1. Actual overhead costs incurred other than ndirect labor and indirect materials were depreciation, $8,000, and utilities, fuel, and miscellaneous, $15,500 which is scheduled to be paid next month Was overhead under or over-applied? Make a journal entry to correct any difference, if needed Required: 1. Prepare a job cost sheet for each job. 2. Prepare journal entries for the January activity (labeled a to j above) assuming all purchases and sales were on credit. 3. Prepare an income statement for January assuming selling and administrative expenses for January were $65,000. 4. Is the company profitable (that is, showing net income greater than zero)? What suggestions can you make for management to help increase the company's net income? 1. Calculate the Job Cost for each job: 100 101 102 Total Self Check: Beg. Work in Process Inventory Direct Materials Direct Labor Applied Overhead 2S10 per labor hour x labor hours) 3 Total Actual Job Cost Self Check on Job Costs: show calculations in this row %24 B F G 6 2. Prepare Journal Entries Debit Credit 18 Purchased materials on account (a) 19 50 51 52 Assign direct material costs to jobs (b) 53 54 55 56 Assign indirect material (supplies) cost used (c) 57 58 59 60 Assign direct labor costs to jobs (d) 61 62 63 64 Assign indirect labor cost used (e) 65 66 67 68 Apply overhead costs to jobs (f) 69 70 71 72 Transfer costs of all jobs to Finished Goods inventory (g) 73 Sheet1 Quality Painters, Inc., uses a job cost system. As of January 1, its records showed the following inventory balances; Materials Work in process $50,000 (consisting of Job 100 $30,000 and $12,000 Job 101 $20,000) Finished goods So (no jobs were finished and unsold as of Jan 1) Here are data for the company in January: a Materials purchased, $85,000. b. Direct materials used: direct materials for Job No. 100, $15,500; for Job No. 101, $28,500; and for Job No. 102 (a new job), $48,000. c Supplies (indirect materials) used amounted to $5,500. d. Direct labor costs: direct labor to Job No. 100, $22,500; to Job No. 101, $40,000, and to Job No. 102, $50,000. e. Indirect labor, $22,500. f Overhead is assigned to jobs at $8 per labor-hour, with 500 labor-hours to Job 100 and 2,500 labor-hours each to Jobs 101 and 102. g. Jobs 100 and 102 were completed in January (Job 101 was not finished) h Sales revenues for January were $250,000 for Job 100 (Job 102 has not been sold) 1. Actual overhead costs incurred other than ndirect labor and indirect materials were depreciation, $8,000, and utilities, fuel, and miscellaneous, $15,500 which is scheduled to be paid next month Was overhead under or over-applied? Make a journal entry to correct any difference, if needed Required: 1. Prepare a job cost sheet for each job. 2. Prepare journal entries for the January activity (labeled a to j above) assuming all purchases and sales were on credit. 3. Prepare an income statement for January assuming selling and administrative expenses for January were $65,000. 4. Is the company profitable (that is, showing net income greater than zero)? What suggestions can you make for management to help increase the company's net income? 1. Calculate the Job Cost for each job: 100 101 102 Total Self Check: Beg. Work in Process Inventory Direct Materials Direct Labor Applied Overhead 2S10 per labor hour x labor hours) 3 Total Actual Job Cost Self Check on Job Costs: show calculations in this row %24 B F G 6 2. Prepare Journal Entries Debit Credit 18 Purchased materials on account (a) 19 50 51 52 Assign direct material costs to jobs (b) 53 54 55 56 Assign indirect material (supplies) cost used (c) 57 58 59 60 Assign direct labor costs to jobs (d) 61 62 63 64 Assign indirect labor cost used (e) 65 66 67 68 Apply overhead costs to jobs (f) 69 70 71 72 Transfer costs of all jobs to Finished Goods inventory (g) 73 Sheet1

Answer rating: 100% (QA)

Question1 Answer1 100 101 102 Total Beg Work in process inventory 30000 20000 50000 Direct materials ... View the full answer