For the year ended December 31, 2017, the job cost sheets of Cinta Company contained the following
Question:
For the year ended December 31, 2017, the job cost sheets of Cinta Company contained the following data.
Job |
| Direct | Direct | Manufacturing | Total | |||||
7640 | Balance 1/1 | $28,000 | $26,880 | $32,256 | $87,136 | |||||
Current year’s costs | 33,600 | 40,320 | 48,384 | 122,304 | ||||||
7641 | Balance 1/1 | 12,320 | 20,160 | 24,192 | 56,672 | |||||
Current year’s costs | 48,160 | 53,760 | 64,512 | 166,432 | ||||||
7642 | Current year’s costs | 64,960 | 61,600 | 73,920 | 200,480 |
Other data:
1. | Raw materials inventory totaled $16,800 on January 1. During the year, $156,800 of raw materials were purchased on account. | |
2. | Finished goods on January 1 consisted of Job No. 7638 for $97,440 and Job No. 7639 for $103,040. | |
3. | Job No. 7640 and Job No. 7641 were completed during the year. | |
4. | Job Nos. 7638, 7639, and 7641 were sold on account for $593,600. | |
5. | Manufacturing overhead incurred on account totaled $134,400. | |
6. | Other manufacturing overhead consisted of indirect materials $15,680, indirect labor $20,160, and depreciation on factory machinery $8,960. |
A- Prove the agreement of Work in Process Inventory with job cost sheets pertaining to unfinished work. (Hint: Use a single T-account for Work in Process Inventory.) Post each to the T-account in the following order: (1) beginning balance, (2) direct materials, (3) direct labor, (4) manufacturing overhead, and (5) completed jobs.
Work in process balance: |
Unfinished job:
B- Prepare the adjusting entry for manufacturing overhead, assuming the balance is allocated entirely to Cost of Goods Sold.
C-Determine the gross profit to be reported for 2017.
Accounting Principles
ISBN: 978-1118875056
12th edition
Authors: Jerry Weygandt, Paul Kimmel, Donald Kieso