Complete the Inventory and Overhead T-Accounts For Job 1 and Job 2 and Job 3 Kaitlyn, Inc. is a manufacturer who uses a job order costing system. The data below summarizesthe operations related to production and sales for January, the first month of operations. Kaitlyn,Inc. allocates factory overhead on a monthly basis based upon total monthly factory overheadcosts and direct labor hours. Total direct labor hours for January are 75,000 hours.Purchased the following raw materials:6,000 units for Job 1 @ $10/unit5,500 units for Job 2 @ $15/unit12,300 units for Job 3 @ $5/unitRequisitioned materials for production:5,000 units for Job 1 @ $10/unit4,000 units for Job 2 @ $15/unit10,000 unit for Job 3 @ $5/unitDirect labor costs:2,000 hours of direct labor on Job 1 at $15 per hour10,000 hours of direct labor on Job 2 at $14 per hour8,000 hours of direct labor on Job 3 at $20 per hourTotal factory overhead costs for the month:• $70,000 of indirect materials$115,000 of indirect labor$97,000 of utilities costs$18,000 of factory depreciationProduction data:Job 1 produced 5,000 units out of an estimated possible 8,000 units,Job 2 produced 20,000 units out of an estimated possible 24,000 unitsJob 3 produced 11,000 units out of an estimated possible 12,100 units,Sales data:Job 1 → 4,000 units sold on credit for $25unitperJob 2 → 18,000 units sold on credit for $30 per unitJob 3 → 10,000 units sold on credit for $50реrunitTo Do: Complete the T-Accounts on the following page, as well as the Cost Flow Worksheets.Helpful Hint: While not required for this assignment, it might be helpful to create the relatedjournal entries. Inventory and Overhead T-Accounts: Job 1 and Job 2 and Job 3Raw MaterialsWIPFinished GoodsOverhead

Job costing is the method of costing applied when each job is different from the other. These method…

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Business

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Complete the Inventory and Overhead T-Accounts For Job 1 and Job 2 and Job 3

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Complete the Inventory and Overhead T-Accounts For Job 1 and Job 2 and Job 3

Kaitlyn, Inc. is a manufacturer who uses a job order costing system. The data below summarizes
the operations related to production and sales for January, the first month of operations. Kaitlyn,
Inc. allocates factory overhead on a monthly basis based upon total monthly factory overhead
costs and direct labor hours. Total direct labor hours for January are 75,000 hours.
Purchased the following raw materials:
6,000 units for Job 1 @ $10/unit
5,500 units for Job 2 @ $15/unit
12,300 units for Job 3 @ $5/unit
Requisitioned materials for production:
5,000 units for Job 1 @ $10/unit
4,000 units for Job 2 @ $15/unit
10,000 unit for Job 3 @ $5/unit
Direct labor costs:
2,000 hours of direct labor on Job 1 at $15 per hour
10,000 hours of direct labor on Job 2 at $14 per hour
8,000 hours of direct labor on Job 3 at $20 per hour
Total factory overhead costs for the month:
• $70,000 of indirect materials
$115,000 of indirect labor
$97,000 of utilities costs
$18,000 of factory depreciation
Production data:
Job 1 produced 5,000 units out of an estimated possible 8,000 units,
Job 2 produced 20,000 units out of an estimated possible 24,000 units
Job 3 produced 11,000 units out of an estimated possible 12,100 units,
Sales data:
Job 1 → 4,000 units sold on credit for $25
unit
per
Job 2 → 18,000 units sold on credit for $30 per unit
Job 3 → 10,000 units sold on credit for $50
реr
unit
To Do: Complete the T-Accounts on the following page, as well as the Cost Flow Worksheets.
Helpful Hint: While not required for this assignment, it might be helpful to create the related
journal entries.

Inventory and Overhead T-Accounts: Job 1 and Job 2 and Job 3
Raw Materials
WIP
Finished Goods
Overhead

Definition Definition Indirect costs incurred while producing goods or services. Overhead costs cannot be directly attributed to products or services. Overhead includes indirect material cost, indirect labor cost, rent, utilities expenses, and depreciation. Since these costs directly affect the profitability of a company, managing overhead becomes an important task for management.

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Oak 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: Balance on 3/1 $ 7,500 6,000 $ 13,500 Source documents revealed the following during March: Materials Requisitions Forms $ 3,500 6,000 4,200 1,300 $ 15,000 Work in Process Job 33 Job 34 Labor Time Tickets $ 6,500 7,800 3,250 2,140 $ 19,690 The company applies overhead to products at a rate of 150 percent of direct labor cost. Job 33 Job 34 Job 35 Indirect Required: Prepare journal entries to record the materials requisitions, labor costs, and applied overhead. Note: If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field. View transaction list Journal entry worksheet 1 2 Transaction a Record the issuance of raw materials to production. Note: Enter debits before credits. 3 Record entry Status of Job at Month-End Completed and sold…
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Question 2, part 2
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Vaughn Church Furniture manufactures custom pews, altars, and pulpits for churches across the southern United States. Since each order is unique, Vaughn uses a job order costing system. During the month of June, Vaughn worked on orders for three churches: Faith Church, Grace Church, and Hope Church. Production on the Faith and Grace orders began in May, and the Faith job was completed in June. Production on the Hope order began in June and was incomplete at the end of the month. Vaughn applies overhead to each job based on machine hours. Prior to the year, managers had estimated manufacturing overhead at $ 693,000, along with 21,000 machine hours. Additional cost information related to the three orders is as follows: Faith Grace Hope Beginning balance, June 1 $ 4,000 $ 2,800 Direct materials, June $ 8,300 $ 6,500 $ 4,000 Direct labor, June $ 13,000 $7,000 $ 5,500 Manufacturing OH, June ? ? Machine hours, June 2,200 1,300 1,400