Problem 16-3A Case Inc. is a construction company specializing in custom patios.
ID: 2397022 • Letter: P
Question
Problem 16-3A
Case Inc. is a construction company specializing in custom patios. The patios are constructed of concrete, brick, fiberglass, and lumber, depending upon customer preference. On June 1, 2017, the general ledger for Case Inc. contains the following data.
Subsidiary data for Work in Process Inventory on June 1 are as follows.
Job Cost Sheets
Customer Job
Cost Element
Rodgers
Stevens
Linton
$ 2,448
During June, raw materials purchased on account were $ 5,439 , and all wages were paid. Additional overhead costs consisted of depreciation on equipment $ 999 and miscellaneous costs of $ 444 incurred on account.
A summary of materials requisition slips and time tickets for June shows the following.
Customer Job
Materials Requisition Slips
Time Tickets
Overhead was charged to jobs at the same rate of $ 1.25 per dollar of direct labor cost. The patios for customers Rodgers, Stevens, and Linton were completed during June and sold for a total of $ 20,979 . Each customer paid in full.
Journalize the June transactions: (1) for purchase of raw materials, factory labor costs incurred, and manufacturing overhead costs incurred; (2) assignment of direct materials, labor, and overhead to production; and (3) completion of jobs and sale of goods. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Round answers to 0 decimal places, e.g. 2,500.)
Raw Materials Inventory $ 4,662 Manufacturing Overhead Applied $ 36,230 Work in Process Inventory $ 6,149 Manufacturing Overhead Incurred $ 35,132Explanation / Answer
cost of goods sold
Date Account Debit credit 1a Raw material inventory 5439 Accounts payable 5439 [raw material purchased on account] b Factory labor 5329 cash 5329 c Manufacturing overhead 1443 Accumulated depreciation 999 Accounts payable 444 [Manufacturing overhead incurred] 2 work in process 5439 manufacturing overhead 1665 Raw material inventory 7104 b work in process 3997 manufacturing overhead 1332 Factory labor 5329 c work in process 4996 manufacturing overhead 4996 [Overhead applied 3997*1.25] 3 cash 20979 sales revenue 20979 b cost of goods sold 16363 Finished goods inventory 16363