EXERCISE 3-10 Applying Overhead; Journal Entries; T-accounts LO3-1, LO3-2 Dillon Products manufactures various machined parts to customer specifications. The company uses a job-order costing system and applies overhead cost to jobs on the basis of machine-hours. At the beginning of the year, the company used a cost formula to estimate that it would incur $4,800,000 in manufacturing overhead cost at an activity level of 240,000 machine-hours. The company spent the entire month of January working on a large order for 16,000 custom- made machined parts. The company had no work in process at the beginning of January. Cost data relating to January follow: Raw materials purchased on account, $325,000. Raw materials used in production, $290,000 (80% direct materials and 20% indirect materials). Labor cost accrued in the factory, $180,000 (one-third direct labor and two-thirds indirect labor). d. Depreciation recorded on factory equipment, $75,000. Other manufacturing overhead costs incurred on account, $62,000. f. Manufacturing overhead cost was applied to production on the basis of 15,000 machine-hours actually worked during the month. The completed job for 16,000 custom-made machined parts was moved into the finished goods warehouse on January 31 to await delivery to the customer. (In computing the dollar amount for this entry, remember that the cost of a completed job consists of direct materials, direct labor, and applied overhead.) 6. а. b. с. е. g. 1. Prepare journal entries to record items (a) through (f) above [ignore item (g) for the moment]. 2. Prepare T-accounts for Manufacturing Overhead and Work in Process. Post the relevant items from your journal entries to these T-accounts. 3. Prepare a journal entry for item (g) above. 4. If 10,000 of the custom-made machined parts are shipped to the customer in February, how much of this job's cost will be included in cost of goods sold for February?
EXERCISE 3-10 Applying Overhead; Journal Entries; T-accounts LO3-1, LO3-2 Dillon Products manufactures various machined parts to customer specifications. The company uses a job-order costing system and applies overhead cost to jobs on the basis of machine-hours. At the beginning of the year, the company used a cost formula to estimate that it would incur $4,800,000 in manufacturing overhead cost at an activity level of 240,000 machine-hours. The company spent the entire month of January working on a large order for 16,000 custom- made machined parts. The company had no work in process at the beginning of January. Cost data relating to January follow: Raw materials purchased on account, $325,000. Raw materials used in production, $290,000 (80% direct materials and 20% indirect materials). Labor cost accrued in the factory, $180,000 (one-third direct labor and two-thirds indirect labor). d. Depreciation recorded on factory equipment, $75,000. Other manufacturing overhead costs incurred on account, $62,000. f. Manufacturing overhead cost was applied to production on the basis of 15,000 machine-hours actually worked during the month. The completed job for 16,000 custom-made machined parts was moved into the finished goods warehouse on January 31 to await delivery to the customer. (In computing the dollar amount for this entry, remember that the cost of a completed job consists of direct materials, direct labor, and applied overhead.) 6. а. b. с. е. g. 1. Prepare journal entries to record items (a) through (f) above [ignore item (g) for the moment]. 2. Prepare T-accounts for Manufacturing Overhead and Work in Process. Post the relevant items from your journal entries to these T-accounts. 3. Prepare a journal entry for item (g) above. 4. If 10,000 of the custom-made machined parts are shipped to the customer in February, how much of this job's cost will be included in cost of goods sold for February?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
the sub-parts to be solved please
Transcribed Image Text:EXERCISE 3-10 Applying Overhead; Journal Entries; T-accounts LO3-1, LO3-2
Dillon Products manufactures various machined parts to customer specifications. The company
uses a job-order costing system and applies overhead cost to jobs on the basis of machine-hours.
At the beginning of the year, the company used a cost formula to estimate that it would incur
$4,800,000 in manufacturing overhead cost at an activity level of 240,000 machine-hours.
The company spent the entire month of January working on a large order for 16,000 custom-
made machined parts. The company had no work in process at the beginning of January. Cost data
relating to January follow:
Raw materials purchased on account, $325,000.
Raw materials used in production, $290,000 (80% direct materials and 20% indirect materials).
Labor cost accrued in the factory, $180,000 (one-third direct labor and two-thirds indirect labor).
d. Depreciation recorded on factory equipment, $75,000.
Other manufacturing overhead costs incurred on account, $62,000.
f. Manufacturing overhead cost was applied to production on the basis of 15,000 machine-hours
actually worked during the month.
The completed job for 16,000 custom-made machined parts was moved into the finished
goods warehouse on January 31 to await delivery to the customer. (In computing the dollar
amount for this entry, remember that the cost of a completed job consists of direct materials,
direct labor, and applied overhead.)
6.
а.
b.
с.
е.
g.
![1.
Prepare journal entries to record items (a) through (f) above [ignore item (g) for the moment].
2.
Prepare T-accounts for Manufacturing Overhead and Work in Process. Post the relevant items
from your journal entries to these T-accounts.
3.
Prepare a journal entry for item (g) above.
4.
If 10,000 of the custom-made machined parts are shipped to the customer in February,
how much of this job's cost will be included in cost of goods sold for February?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F05a639e3-77d0-4fe2-93f4-24b810a234c5%2F1d8f5c77-d9bb-4973-a638-3b1c14f48032%2F67xumhe_processed.png&w=3840&q=75)
Transcribed Image Text:1.
Prepare journal entries to record items (a) through (f) above [ignore item (g) for the moment].
2.
Prepare T-accounts for Manufacturing Overhead and Work in Process. Post the relevant items
from your journal entries to these T-accounts.
3.
Prepare a journal entry for item (g) above.
4.
If 10,000 of the custom-made machined parts are shipped to the customer in February,
how much of this job's cost will be included in cost of goods sold for February?
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education