Sinatra Industries, Inc. uses a job order cost system. The following data summar
ID: 2377286 • Letter: S
Question
Sinatra Industries, Inc. uses a job order cost system. The following data summarize the operations related to production for June 2012, the first month of operations:
a.) Materials purchased on account, $32,760.
b.) Materials requisitioned and factory labor used:
Job Materials Factory Labor
301 $3,290 $3,080
302 4,025 4,160
303 2,660 2,080
304 9,030 7,640
305 5,740 5,810
306 4,170 3,710
For general factory use 1,200 4,550
c.) Factory overhead costs incurred on account, $6,300.
d) .Depreciation of machinery and equipment, $2,200.
e.) The factory overhead rate is $58 per machine hour. Machine hours used:
Job Machine hours
301 26
302 38
303 30
304 80
305 40
306 26
Total 240
f.) Jobs completed: 301, 302, 303, and 305.
g.) Jobs were shipped and customers were billed as follows: Job 301, $9,150; Job 302, $12,350; Job 303, $16,600.
1. Journalize the entries to record the summarized operations.
2. Post the appropriate journal entries to T accounts for Work in Process and Finished Goods, using the identifying letters as dates. Insert emo account balances as of the end of the month.
3. Prepare a schedule of unfinished jobs to support the balance in the work in process account.
4. Prepare a schedule of completed jobs on hand to support the balance in the finished goods account.
Can anyone help me out here by chance? It doesn't really give good examples in the book.
Thanks
Explanation / Answer
1)
Debit Credit
1) A) Materials A/c Dr. 32,760
To Account payable Cr. 32,760
B) Work in Progress A/c Dr. 41,475
Factory Overhead A/c Dr. 13,920
To Materials (Cr.) 28,915
To Wages payable (Cr.) 26,480
C) Factory Overhead A/c Dr. 6,300
To Accounts payable (Cr.) 6,300
D) Factory overhead A/c Dr. 2,200
To Accumulated Depreciation-Machinery (Cr.) 2,200
E) Work in Progress A/c Dr. 13,920
To Factory Overhead (Cr.) 13,920
F) Finished Goods A/c Dr. 38,617
To Work in Progress (Cr.) 38,617
G) Accounts receivable A/c Dr. 38,100
To Sales (Cr.) 38,100
H) Cost of Goods Sold A/c Dr. 24,545
To Finished Goods (Cr.) 24,545
2) After Posting the appropriate journal entries to T accounts for Work in Process and Finished Goods
W.I.P=16778 and Finished Goods =14072
3) JOB Direct Material Direct labor Factory overhead Total
304 3,920 3,080 4,640 11,640
306 4,170 3,710 1,580 9,388
Balance of Work in Progress as on 31st june,2012 21,028
4)schedule of completed jobs on hand to support the balance in the finished goods account
JOB Direct Material Direct labor Factory overhead Total
305 5,740 5,810 2,320 13,870