Auto-Motion is a lean manufacturer of self-driving wheelchairs. The company budgets $646,000 of conversion costs and 1,700 production hours for this year. The manufacturing of each wheelchair requires 25 production hours and raw materials costs of $4,360. The company started and completed 86 wheelchairs during the year and sold 70. Each wheelchair is sold for $15,600. Actual conversion costs equal applied conversion costs. Required: 1. Prepare journal entries to record (a) the purchase of raw materials on credit to produce 86 units, (b) applied conversion costs to the production of 86 units, (c) actual conversion costs of $817,000 (credit "Various Accounts"), (d) sale of 70 units on credit, and (e) ending inventory and cost of goods sold. 2. Compute the ending balances of Work in Process Inventory and Finished Goods Inventory. Assume each of these inventory accounts began the year with a balance of zero. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare journal entries to record (a) the purchase of raw materials on credit to produce 86 units, (b) applied conversion costs to the production of 86 units, (c) actual conversion costs of $817,000 (credit "Various Accounts"), (d) sale of 70 units on credit, and (e) ending inventory and cost of goods sold. View transaction list View journal entry worksheet Required 1 Required 2 Prepare journal entries to record (a) the purchase of raw materials on credit to produce 86 units, (b) applied conversion costs to production of 86 units, (c) actual conversion costs of $817,000 (credit "Various Accounts"), (d) sale of 70 units on credit, and (e) inventory and cost of goods sold. View transaction list View journal entry worksheet No Transaction General Journal 1 a. Work in process inventory Accounts payable 2 b. Work in process inventory Conversion costs 3 C. Conversion costs Various accounts 4 LO 5 d. Accounts receivable Sales Debit Credit 374,960 374,960 817,000 817,000 817,000 817,000 1,092,000 1,092,000 e. Cost of goods sold 970,200 Finished goods inventory X

Auto-Motion is a lean manufacturer of self-driving wheelchairs. The company budgets $646,000 of conversion costs and 1,700 production hours for this year. The manufacturing of each wheelchair requires 25 production hours and raw materials costs of $4,360. The company started and completed 86 wheelchairs during the year and sold 70. Each wheelchair is sold for $15,600. Actual conversion costs equal applied conversion costs. Required: 1. Prepare journal entries to record (a) the purchase of raw materials on credit to produce 86 units, (b) applied conversion costs to the production of 86 units, (c) actual conversion costs of $817,000 (credit "Various Accounts"), (d) sale of 70 units on credit, and (e) ending inventory and cost of goods sold. 2. Compute the ending balances of Work in Process Inventory and Finished Goods Inventory. Assume each of these inventory accounts began the year with a balance of zero. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare journal entries to record (a) the purchase of raw materials on credit to produce 86 units, (b) applied conversion costs to the production of 86 units, (c) actual conversion costs of $817,000 (credit "Various Accounts"), (d) sale of 70 units on credit, and (e) ending inventory and cost of goods sold. View transaction list View journal entry worksheet Required 1 Required 2 Prepare journal entries to record (a) the purchase of raw materials on credit to produce 86 units, (b) applied conversion costs to production of 86 units, (c) actual conversion costs of $817,000 (credit "Various Accounts"), (d) sale of 70 units on credit, and (e) inventory and cost of goods sold. View transaction list View journal entry worksheet No Transaction General Journal 1 a. Work in process inventory Accounts payable 2 b. Work in process inventory Conversion costs 3 C. Conversion costs Various accounts 4 LO 5 d. Accounts receivable Sales Debit Credit 374,960 374,960 817,000 817,000 817,000 817,000 1,092,000 1,092,000 e. Cost of goods sold 970,200 Finished goods inventory X

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter2: Basic Cost Management Concepts

Section: Chapter Questions

Problem 7CE: Jean and Tom Perritz own and manage Happy Home Helpers. Inc. (HHH), a house-cleaning service. Each...

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