The following costs were incurred in February by Container Corp., which produces customized steel storage bins: Direct
Question:
The following costs were incurred in February by Container Corp., which produces customized steel storage bins:
Direct material purchased on account | $152,000 | |
Direct material used for jobs: | ||
Job #217 | $89,600 | |
Job #218 | 14,400 | |
Other jobs | 107,200 | 211,200 |
Direct labor costs for month: | ||
Job #217 | $20,800 | |
Job #218 | 28,000 | |
Other jobs | 39,200 | 88,000 |
Actual overhead costs for February | 440,000 |
The balance in Work in Process Inventory on February 1 was $33,600, which consisted of $22,400 for Job #217 and $11,200 for Job #218. The February beginning balance in Direct Material Inventory was $89,200. Actual overhead is applied to jobs at a rate of $4.95 per dollar of direct labor cost. Job #217 was completed and transferred to Finished Goods Inventory during February. Job #217 was delivered to the customer at the agreed-upon price of cost plus 35 percent.
Required
a. Prepare journal entries to record the preceding information.
b. Determine the February ending balance in WIP Inventory.
c. How much of the balance determined in part (b) relates to Job #218?
Cost Accounting Foundations and Evolutions
ISBN: 978-1111971724
9th edition
Authors: Michael R. Kinney, Cecily A. Raiborn