Ravsten Company uses a job-order costing system. On January 1, the beginning of the current year, the company’s inventory balances were as follows:

Raw materials	$	18,000
Work in process	$	10,800
Finished goods	$	30,400

The company applies overhead cost to jobs on the basis of machine-hours. For the current year, the company estimated that it would work 36,400 machine-hours and incur $161,980 in manufacturing overhead cost. The following transactions were recorded for the year:

1. Raw materials were purchased on account: $208,000.
2. Raw materials were requisitioned for use in production: $194,000 (80% direct and 20% indirect).
3. The following costs were incurred for employee services:

Direct labour	$	163,200
Indirect labour	$	27,800
Sales commissions	$	37,200
Administrative salaries	$	81,600

4. Heat, power, and water costs were incurred in the factory: $43,800.
5. Prepaid insurance expired during the year: $12,000 (85% relates to factory operations, and 15% relates to selling and administrative activities).
6. Advertising costs were incurred, $52,000.
7. Depreciation was recorded for the year: $62,400 (90% relates to factory operations, and 10% relates to selling and administrative activities).
8. Manufacturing overhead cost was applied to production. The company recorded 40,800 machine-hours for the year.
9. Goods that cost $497,600 to manufacture according to their job cost sheets were transferred to the finished goods warehouse.
10. Sales for the year totalled $718,600 and were all on account. The total cost to manufacture these goods according to their job cost sheets was $491,800.

Required:

1. Prepare journal entries to record the transactions given above. (Do not round intermediate calculations. If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

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No Transaction General Journal Debit Credit 2. Prepare T-accounts for Inventories, Manufacturing Overhead, and Cost of Goods Sold. Post relevant data from your journal entries to these T-accounts (don't forget to enter the opening balances in your Inventory accounts). Compute an ending balance in each account. 1 a. Raw materials 208,000 Accounts payable 208,000 Raw Materials Manufacturing Overhead 2 b. Work in process 155,200 18,000 208,000 Beg. Bal. b. Beg. Bal. Manufacturing overhead 38,800 a. 194,000 b. 38,800 181,560 h. Raw materials 194,000 End. Bal. 32,000 C. 27,800 d. 43,800 3 C. Work in process 163,200 e. 10,200 Manufacturing overhead 27,800 Sales commissions expense 37,200 g. 56,160 End. Bal. 4,800 Administrative salaries expense 81,600 Salaries and wages payable 309,800 Work in Process Cost of Goods Sold 10,800 155,200 Manufacturing overhead Beg. Bal. Beg. Bal. d. 43,800 Accounts payable 43,800 b. 497,600 i. 491,800 163,200 181,560 с. End. Bal. 491,800 Manufacturing overhead 10,200 h. e. Insurance expense 1,800 End. Bal. 13,160 Prepaid insurance 12,000 Finished Goods f. Advertising expense 52,000 Beg. Bal. 30,400 Accounts payable 52,000 497,600 491,800 j. End. Bal. 36,200 g. Manufacturing overhead 56, 160 Depreciation expense 6,240 Accumulated depreciation 62,400 3-a. Is manufacturing overhead underapplled or overapplied for the year? h. Work in process 181,560 Overapplied overhead Manufacturing overhead 181,560 O Underapplied overhead 9 i. Finished goods 497,600 3-b. Prepare a journal entry to properly dispose of any balance in the Manufacturing Overhead account. (Do not round Intermediate calculations and round your final answers to 2 decimal places. If no entry is required for a transaction/event, select "No Journal entry required" In the first account fleld.) Work in process 497,600 10 j-1. Accounts receivable 718,600 Sales 718,600 View transaction list View journal entry worksheet 11 J-2. Cost of goods sold 491,800 No Event General Journal Debit Credit Finished goods 491,800 A 1 Manufacturing overhead 4,800.00 Cost of goods sold 4,401.00 2. Prepare T-accounts for Inventories, Manufacturing Overhead, and Cost of Goods Sold. Post relevant data from your journal er Finished goods 75.00 to these T-accounts (don't forget to enter the opening balances in your Inventory accounts). Compute an ending balance in eact account. Work in process 324.00 4. Prepare an income statement for the year (Do not round Intermediete cakuletions and round your finel answers to nearest whole doller amount.) RAVSTEN COMPANY 26. Prepere a joursy enry to properly cose of any baasce inte Menatactang Ovateed sccount (Do nat round rtermedias caicaintions and round your rel antwes to 2 decimal places Fro entry is requiree for a trencactioneert select "No joumal try required" in the frs accoum Seld Answer is complete but not entirely correct. Incone Statement General Journel Dolhit For the Year Ended December 31 CIedit Mayatscharing overhead Cost of goods scld 718,000 4,800.00 Sales Cost of goods sold Gross proft Anwwe k conwplete batest enirely comect. 4.401.03 492.900 225,800 Frated geed Event Geserd Jeunal 75.00 Debit Crecit Wark in process 224 DO Sling and adminratve xpatse 1. Mamutucuring ovehwad 4,J0 00 Sales commiasions Cent of gonds tald 4.M2O 203 זב 81,600 Faied gooes 321 96 Adminsrative saaries Wot oncess 7492 aunance epense 1,800 52,000 6240 Depreciation enperse 178 840 statement for the year. (Do not round Intermedilate ceiculations and round your final vhole dollar amount) Operating income 46.950 4. Prepare an incone taenent for the yes De net sourd vere calcaions are raund your neal anovers o rewest swhele ocer enoeL) 15wer is comglete bet not entirely correct. RAYSTEN COWPANY OArower is cerpkte bt not einely camect. Incone Statenest kaSTEN COMMY he Year Enced Decenter 35 Income Satoment $ 718.900 492 800 For the Tar Caced Decamber 4 & 7800 0 225,300 Cast of goods soid GraE prote Selling and e Bees m re Aanintrative alre 201 O: 37 200O 81.600 05200 nt0000 1000 1,000 52,000 neurancs wpenH 8240 179.840 0000 No Transaction General Journal Debit Credit 2. Prepare T-accounts for Inventories, Manufacturing Overhead, and Cost of Goods Sold. Post relevant data from your journal entries to these T-accounts (don't forget to enter the opening balances in your Inventory accounts). Compute an ending balance in each account. 1 a. Raw materials 208,000 Accounts payable 208,000 Raw Materials Manufacturing Overhead 2 b. Work in process 155,200 18,000 208,000 Beg. Bal. b. Beg. Bal. Manufacturing overhead 38,800 a. 194,000 b. 38,800 181,560 h. Raw materials 194,000 End. Bal. 32,000 C. 27,800 d. 43,800 3 C. Work in process 163,200 e. 10,200 Manufacturing overhead 27,800 Sales commissions expense 37,200 g. 56,160 End. Bal. 4,800 Administrative salaries expense 81,600 Salaries and wages payable 309,800 Work in Process Cost of Goods Sold 10,800 155,200 Manufacturing overhead Beg. Bal. Beg. Bal. d. 43,800 Accounts payable 43,800 b. 497,600 i. 491,800 163,200 181,560 с. End. Bal. 491,800 Manufacturing overhead 10,200 h. e. Insurance expense 1,800 End. Bal. 13,160 Prepaid insurance 12,000 Finished Goods f. Advertising expense 52,000 Beg. Bal. 30,400 Accounts payable 52,000 497,600 491,800 j. End. Bal. 36,200 g. Manufacturing overhead 56, 160 Depreciation expense 6,240 Accumulated depreciation 62,400 3-a. Is manufacturing overhead underapplled or overapplied for the year? h. Work in process 181,560 Overapplied overhead Manufacturing overhead 181,560 O Underapplied overhead 9 i. Finished goods 497,600 3-b. Prepare a journal entry to properly dispose of any balance in the Manufacturing Overhead account. (Do not round Intermediate calculations and round your final answers to 2 decimal places. If no entry is required for a transaction/event, select "No Journal entry required" In the first account fleld.) Work in process 497,600 10 j-1. Accounts receivable 718,600 Sales 718,600 View transaction list View journal entry worksheet 11 J-2. Cost of goods sold 491,800 No Event General Journal Debit Credit Finished goods 491,800 A 1 Manufacturing overhead 4,800.00 Cost of goods sold 4,401.00 2. Prepare T-accounts for Inventories, Manufacturing Overhead, and Cost of Goods Sold. Post relevant data from your journal er Finished goods 75.00 to these T-accounts (don't forget to enter the opening balances in your Inventory accounts). Compute an ending balance in eact account. Work in process 324.00 4. Prepare an income statement for the year (Do not round Intermediete cakuletions and round your finel answers to nearest whole doller amount.) RAVSTEN COMPANY 26. Prepere a joursy enry to properly cose of any baasce inte Menatactang Ovateed sccount (Do nat round rtermedias caicaintions and round your rel antwes to 2 decimal places Fro entry is requiree for a trencactioneert select "No joumal try required" in the frs accoum Seld Answer is complete but not entirely correct. Incone Statement General Journel Dolhit For the Year Ended December 31 CIedit Mayatscharing overhead Cost of goods scld 718,000 4,800.00 Sales Cost of goods sold Gross proft Anwwe k conwplete batest enirely comect. 4.401.03 492.900 225,800 Frated geed Event Geserd Jeunal 75.00 Debit Crecit Wark in process 224 DO Sling and adminratve xpatse 1. Mamutucuring ovehwad 4,J0 00 Sales commiasions Cent of gonds tald 4.M2O 203 זב 81,600 Faied gooes 321 96 Adminsrative saaries Wot oncess 7492 aunance epense 1,800 52,000 6240 Depreciation enperse 178 840 statement for the year. (Do not round Intermedilate ceiculations and round your final vhole dollar amount) Operating income 46.950 4. Prepare an incone taenent for the yes De net sourd vere calcaions are raund your neal anovers o rewest swhele ocer enoeL) 15wer is comglete bet not entirely correct. RAYSTEN COWPANY OArower is cerpkte bt not einely camect. Incone Statenest kaSTEN COMMY he Year Enced Decenter 35 Income Satoment $ 718.900 492 800 For the Tar Caced Decamber 4 & 7800 0 225,300 Cast of goods soid GraE prote Selling and e Bees m re Aanintrative alre 201 O: 37 200O 81.600 05200 nt0000 1000 1,000 52,000 neurancs wpenH 8240 179.840 0000

Answer rating: 100% (QA)

Sl no Account title Debit Credit 1 Raw material inventory 208000 Account payabl... View the full answer