Marcelino Co.\'s March 31 inventory of raw materials is $82,000. Raw materials p
ID: 2412661 • Letter: M
Question
Marcelino Co.'s March 31 inventory of raw materials is $82,000. Raw materials purchases in April are $600,000, and factory payroll cost in April is $390,000. Overhead costs incurred in April are: indirect materials, $59,000; indirect labor, $29,000; factory rent, $34,000; factory utilities, $21,000; and factory equipment depreciation, $61,000. The predetermined overhead rate is 50% of direct labor cost. Job 306 is sold for $670,000 cash in April. Costs of the three jobs worked on in April follow.
Required:
1. Determine the total of each production cost incurred for April (direct labor, direct materials, and applied overhead), and the total cost assigned to each job (including the balances from March 31).
2. Prepare journal entries for the month of April to record the below transactions. (Hint, there are 13 steps)
Materials purchases (on credit).
Direct materials used in production.
Direct labor paid and assigned to Work in Process Inventory.
Indirect labor paid and assigned to Factory Overhead.
Overhead costs applied to Work in Process Inventory.
Actual overhead costs incurred, including indirect materials. (Factory rent and utilities are paid in cash.)
Transfer of Jobs 306 and 307 to Finished Goods Inventory.
Cost of goods sold for Job 306.
Revenue from the sale of Job 306.
Assignment of any underapplied or overapplied overhead to the Cost of Goods Sold account. (The amount is not material.)
Job 306 Job 307 Job 308 Balances on March 31 Direct materials $ 28,000 $ 39,000 Direct labor 24,000 18,000 Applied overhead 12,000 9,000 Costs during April Direct materials 133,000 220,000 $ 115,000 Direct labor 105,000 154,000 102,000 Applied overhead ? ? ? Status on April 30 Finished (sold) Finished (unsold) In processExplanation / Answer
ans 1 Job 306 Job 307 Job 308 April Total From March Direct Materials $28,000 $39,000 $67,000 Direct Labor 24,000 18,000 42,000 Applied overhead 12,000 9,000 21,000 Beginning goods in process B $64,000 $66,000 $130,000 For April Direct Materials 133,000 220,000 115,000 468,000 Direct Labor D 105,000 154,000 102,000 361,000 Applied overhead (50%*D) 52500 77000 51000 180500 Total costs added in April T 290,500 451,000 268,000 1,009,500 Total costs (April 30) B+T $354,500 $517,000 $268,000 $1,139,500 Status on April 30 Finished (sold) Finished (unsold) In process April 30 cost included in: Transa Accounst Title Dr Cr a Raw Material Inventory 600000 Accounts payable 600000 b) Work in Process Inventory 468,000 Raw material Inventory 468,000 c) Factory wages 361000 Cash 361000 Work in Process Inventory 361,000 Factory wages 361,000 d) Factory wages 29000 Cash 29000 Factory Overhead 180500 Factory wages 180500 e Work in Process Inventory 180500 Factory Overhead 180500 f Factory Overhead $175,000 Raw material Inventory $59,000 Cash (34000+21000) 55000 Accumulated depreciation-Factory equipment 61000 g Finished Goods Inventory $871,500 Work in Process Inventory $871,500 h Cost of Good sold 238000 Finished Goods Inventory 238000 g Accounts Receivable 670000 Sales 670000