Cullumber Company uses a job order cost system and applies overhead to production on the basis of direct labor costs.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Cullumber Company uses a job order cost system and applies overhead to production on the basis of direct labor costs. On January 1, 2022, Job 50 was the only job in process. The costs incurred prior to January 1 on this job were as follows: direct materials $16,800, direct labor $10,080, and manufacturing overhead $13,440. As of January 1, Job 49 had been completed at a cost of $75,600 and was part of finished goods inventory. There was a $12,600 balance in the Raw Materials Inventory account on January 1.

During the month of January, Cullumber Company began production on Jobs 51 and 52, and completed Jobs 50 and 51. Jobs 49 and 50 were sold on account during the month for $102,480 and $132,720, respectively. The following additional events occurred during the month.

1.   Purchased additional raw materials of $75,600 on account.
2.   Incurred factory labor costs of $58,800.
3.   Incurred manufacturing overhead costs as follows: depreciation expense on equipment $10,080; and various other manufacturing overhead costs on account $13,440.
4.   Assigned direct materials and direct labor to jobs as follows.
     
   
Job No.
 
Direct Materials
 
Direct Labor
50
  $8,400   $4,200
51
  32,760   21,000
52
  25,200   16,800
     
5.   Assigned indirect materials of $14,280 and indirect labor of $16,800.
What is the balance in the Finished Goods Inventory account at the end of the month? (Hint: Use a T-account for Finished Goods Inventory.) What does this balance consist of?
Finished Goods Inventory $
eTextbook and Media
List of Accounts
Your answer is partially correct.
What is the amount of over- or underapplied overhead?
Manufacturing Overhead
78960
$
4200
Job No. 51
Underapplied v
Transcribed Image Text:What is the balance in the Finished Goods Inventory account at the end of the month? (Hint: Use a T-account for Finished Goods Inventory.) What does this balance consist of? Finished Goods Inventory $ eTextbook and Media List of Accounts Your answer is partially correct. What is the amount of over- or underapplied overhead? Manufacturing Overhead 78960 $ 4200 Job No. 51 Underapplied v
Prepare the journal entry to record the completion of any job(s) during the month. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually.)
Account Titles and Explanation
Finished Goods Inventory
Work in Process Inventory
Debit
136920
Credit
136920
Transcribed Image Text:Prepare the journal entry to record the completion of any job(s) during the month. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Titles and Explanation Finished Goods Inventory Work in Process Inventory Debit 136920 Credit 136920
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