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Gold Nest Company of Guandong, China, is a family-owned enterprise that makes birdcages for the South China market. The company sells its birdcages through an extensive network of street vendors who receive commissions on their sales. The company uses a job-order costing system in which overhead is applied to jobs on the basis of direct labor cost. Its predetermined overhead rate is based on a cost formula that estimated $76,000 of manufacturing overhead for an estimated activity level of $40,000 direct labor dollars. At the beginning of the year, the inventory balances were as follows: $ 10,900 Work in process 54,200 Yinished goods $ 9,000 During the year, the following transactions were completed: RAV materials a. Raw materials purchased on account, $166,000 b. Raw materials used in production, $145,000 (materials costing $129,000 were charged directly to jobs; the remaining materials were indirect) c. Costs for employee services were incurred as follows: Direct labor Indirect labor Sales comissions Administrative salaries 5 163.000 $ 237,400 $ 25,000 $ 47,000 d. Rent for the year was $18,300 ($13,600 of this amount related to factory operations, and the remainder related to selling and administrative activities) e Utility costs incurred in the factory, $13,000 t Advertising costs incurred, $13,000 9. Depreciation recorded on equipment. $24,000. ($16,000 of this amount related to equipment used in factory operations, the remaining $8,000 related to equipment used in seling and administrative activities.) h Manufacturing overhead cost was applied to jobs, $. ? Goods that had cost $228,000 to manufacture according to their job cost sheets were completed, J.Sales for the year (al paid in cash totaled $499,000. The total cost to manufacture these goods according to their job cost sheets was $217,000 Required: 1 Pronarni Reg1 Reg 2 Reg 3A Reg 38 Reg 4 Prepare T-accounts for each Inventory account, Manufacturing Overhead, and cost of Goods Sold. Post relevant data from your journal entries to these T-account forget to enter the beginning balances in your Inventory accounts). (Do not round intermediate calculations.) Raw Materials Work In Process Debit Dobit Credit Beginning Balance Beginning Balance Credit Ending Balance Ending Balance Finished Goods Manufacturing Overhead Credit Debit Beginning Balance Debit Credit Beginning Balance Ending Balance Cost of Goods Solid Ending Balance Credit Debit Beginning Balance Ending Balance Reg 1 Reg 2 Reg 3A Reg 38 Reg 4 Prepare a joumal entry to close any balance in the Manufacturing Overhead account to Cost of Goods Sold. (If no entry is re transaction/event, select "No journal entry required in the first account field.) View transaction list Journal entry worksheet Record the entry to close any balance in the Manufacturing Overhead account to Cost of Goods Sold Note: Enter debits before credits Transaction General Journal Debit Credit Racord entry Clear entry View general joumal Req1 Reg 2 Req 3A Req 3B Reg 4 Prepare an Income statement for the year. (All of the Information needed for the Income statement is avallable in the you entries and T-accounts you have prepared.) Gold Nest Company Income Statement For the Year Ended 0 Selling and administrative expenses: 0 $ 0
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