ak Creek Furniture Factory (OCFF), a custom furniture manufacturer, uses job order costing to track the cost of each customer order. On March 1, OCFF had two jobs in process with the following costs: Work in Process Balance on 3/1 Job 33 $ 7,500 Job 34 6,000 $ 13,500 Source documents revealed the following during March: Materials Requisitions Forms Labor Time Tickets Status of Job at Month-End Job 33 $ 3,500 $ 6,500 Completed and sold Job 34 6,000 7,800 Completed, but not sold Job 35 4,200 3,250 In process Indirect 1,300 2,140 $ 15,000 $ 19,690 The company applies overhead to products at a rate of 150 percent of direct labor cost. Required: 1. Compute the cost of Jobs 33, 34, and 35 at the end of the month. 2. Calculate the balance in the Work in Process Inventory, Finished Goods Inventory, and Cost of Goods Sold accounts at month-end.
Answers
Answer:
Job 33 $ 27250
Job 34 $ 31500
Job 35 $ 12325
Cost of Goods Sold Job 33 $ 27250
Finished Goods Inventory Job 34 $ 31500
Work in Process Inventory Job 35 $ 12325
Explanation:
Work in Process Balance on 3/1
Job 33 $ 7,500
Job 34 6,000
Total $ 13,500
Job 33
Direct Materials $3500
Direct Labor 6500
Overheads (150%) 9750
Add Opening WIP 7500
Total Cost $ 27250
We add the Direct Material Direct Labor and Mfg overheads with the opening balance of WIP to get the total cost of given jobs.
Job 34
Direct Materials $6000
Direct Labor 7800
Overheads (150%) 11700
Add Opening WIP 6000
Total Cost $ 31500
Job 35
Direct Materials $4200
Direct Labor 3250
Overheads (150%) 4875
Add Opening WIP ------
Total Cost $ 12325
Cost of Goods Sold Job 33 (given) $ 27250
Finished Goods Inventory Job 34 (given) $ 31500
Work in Process Inventory Job 35(given)$ 12325
It is given in the question that Job 34 is transferred to Finished Goods , Job 35 is still in process and Job 33 is cost of goods sold.
Final answer:
By accounting for beginning balances, cost of materials, labor, and overheads, the costs of Jobs 33, 34, and 35 at end of the month are $27,250, $31,500 and $12,325 respectively. The Work in Process Inventory is $12,325, Finished Goods Inventory is $31,500 and Cost of Goods Sold is $27,250.
Explanation:
To calculate the cost of each job at Oak Creek Furniture Factory (OCFF), we first need to consider all cost factors. These include the beginning balances, additional materials requisitioned, labor hours, and overheads. Job overheads for OCFF are applied as 150 percent of direct labor cost.
Job 33: The initial cost was $7,500. During March, materials costing $3,500 and labor cost of $6,500 were added, making a total of $10,000. Applying the overhead calculation, we find that overheads amount to $6,500 * 1.5 = $9,750. The total cost for job 33 is therefore $7,500 (beginning balance) + $10,000 (material and labor costs) + $9,750 (overhead) = $27,250.
Job 34: Initial cost was $6,000. Material and labor costs for March amount to $6,000 and $7,800 respectively, summing up to $13,800. The overhead equals $7,800 * 1.5 = $11,700. The total cost for job 34 is accordingly $6,000 (beginning balance) + $13,800 (material and labor costs) + $11,700 (overhead) = $31,500.
In regard of Job 35, which is still in progress, only the cost of materials $4,200 and labor $3,250 have been added, totalling $7,450. Calculating overheads, we get $3,250 * 1.5 = $4,875. Therefore, the cost so far for job 35 is $7,450 (material and labor costs) + $4,875 (overhead) = $12,325.
For the balance of the Work in Process Inventory, we just include the cost of Job 35, which isn't finished yet: $12,325.
The Finished Goods Inventory includes the cost of Job 34 which is completed but not sold: $31,500.
Cost of Goods Sold consists of completed and sold jobs, in this case only Job 33: $27,250.
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Related Questions
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Answers
Answer: $1760
Explanation:
If the company uses accrual basis accounting, the net income will be calculated as:
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Add: Lessons provided on account = $1,060
Less: Rental bill for may = $(650)
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= $1760
The net income is $1760
Answers
Answer:
In simple words, implementation process refers to the stage under which the strategies and plans are converted into actions. This is one of the main stages as the overall result depends highly on this stage.
In this stage, the supervisor should make sure that the workers are giving their fullest for the job, are the resources needed to perform the job available in adequate quantity.
The best way to implement any strategy is to make short goals with short time periods and evaluate each phase if he team is performing up to the mark.
Answers
Answer:
It would be bettter to make an agreement with the car dealer for the 32,000 in 4 years.
Explanation:
We will y comparing the value of the loan in 4 years;¿ with the 32,000 in for years option:
Principal $ 29,000.00
time 4 years
rate 3% = 3/100 = 0.030
Amount $ 32,639.76
Which is higher than the 32,000 option. Therefore, the loan option is more expensive than the financing through the car dealer.
It is a better option to make deal with the car seller.
Answers
Answer and Explanation:
According to the scenario, journal entry for the given data are as follows:
(a).
Vacation Pay Expenses A/c Dr. $40,000
To Vacation Pay Payable A/c. $40,000
(Being vacation pay for the period is recorded)
(b).
Pension Expenses A/c Dr. $222,750
To Cash A/c. $185,000
To Unfunded Pension Liabilities A/c $37,750 ( $225,750 - $185,000)
( Being pension benefit for the period is recorded)
B. is added back as an adjustment to Net Income in the operating activities section
C. is added back to Purchases of Plant Assets under investing activities
D. is shown as a negative cash flow in the investing activities section
Answers
Answer:B -
Explanation:Depreciation is added back as an adjustment to the net income in the operating activities section.
Answer:
The correct answer is letter "B": is added back as an adjustment to Net Income in the operating activities section.
Explanation:
Since net income is a starting point for calculating cash flows from operating activities, depreciation costs must be added back to net income if the method being used is the indirect process. Therefore, depreciation spending is recorded in the cash flow statement.
Answers
Answer:
Barriers to entry, Internal industry rivalry, Supplier power, buyer power,etc.
Explanation:
Firms that are capable of excessive productions could boost sales volume by increasing the productions at cost advantage of reducing price. But firms that are incapable of increasing the productions capacity will be unable to produce extra quantity to gain any market share.
Barrier to entry : A established large MES of the industry prevents small entrants from entering into the industry.