**Lehigh Manufacturing Corporation Case Study**Lehigh Manufacturing Corporation began operations with the issuance of common stock for $60,000. It purchased raw materials costing $14,000 and worked on three jobs during Year 1. **Direct Costs:**- **Job 1**: - Raw Materials Used: $2,800 - Direct Labor: $6,000- **Job 2**: - Raw Materials Used: $4,000 - Direct Labor: $8,000- **Job 3**: - Raw Materials Used: $6,000 - Direct Labor: $4,000**Total:**- Raw Materials Used: $12,800- Direct Labor: $18,000Factory overhead is applied using a predetermined overhead rate of $0.60 per direct labor dollar. Jobs 2 and 3 were completed, and Job 3 was sold for $20,000 in cash. Lehigh incurred $800 in selling and administrative expenses. Actual factory overhead was $11,300.**Required Tasks:**- **Task a**: Record events in a horizontal statements model. An example of Year 1's first event is provided.- **Task b**: Record closing entry for over- or underapplied manufacturing overhead, assuming it's insignificant.- **Task c**: Prepare a schedule of the cost of goods manufactured and sold, an income statement, and a balance sheet for Year 1.---**Schedule of Cost of Goods Manufactured and Sold for Year 1:**- **Beginning raw materials inventory**- **Purchases**- **Raw materials available**- **Raw materials used**- **Total manufacturing costs**- **Total work in process inventory**- **Cost of goods manufactured**- **Goods available**- **Cost of goods sold**Note: The fields for amounts are placeholders (set to zero initially).This exercise guides students through applying basic accounting concepts in manufacturing, including cost accounting and financial statement preparation.

The computation of a company's entire costs of production within a certain time period is what is…

Lehigh Manufacturing Corporation was started with the issuance of common stock for $60,000. It purchased $14,000 of raw materials and worked on three job orders during Year 1 for which data follow. (Assume that all transactions are for cash unless otherwise indicated.) Direct Raw Materials Used $2,800 Job 1 Job 2 4,000 Job 3 6,000 Total $12,800 Direct Labor $ 6,000 8,000 4,000 $18,000 Factory overhead is applied using a predetermined overhead rate of $0.60 per direct labor dollar. Jobs 2 and 3 were completed during the period and Job 3 was sold for $20,000 cash. Lehigh paid $800 for selling and administrative expenses. Actual factory overhead was $11,300. Required a. Record the preceding events in a horizontal statements model. The first event for Year 1 has been recorded as an example. c. Record the closing entry for over- or underapplied manufacturing overhead in the horizontal statements model, assuming that the amount is insignificant. d. Prepare a schedule of cost of goods manufactured and sold, an income statement, and a balance sheet for Year 1.

Lehigh Manufacturing Corporation was started with the issuance of common stock for $60,000. It purchased $14,000 of raw materials and worked on three job orders during Year 1 for which data follow. (Assume that all transactions are for cash unless otherwise indicated.) Direct Raw Materials Used $2,800 Job 1 Job 2 4,000 Job 3 6,000 Total $12,800 Direct Labor $ 6,000 8,000 4,000 $18,000 Factory overhead is applied using a predetermined overhead rate of $0.60 per direct labor dollar. Jobs 2 and 3 were completed during the period and Job 3 was sold for $20,000 cash. Lehigh paid $800 for selling and administrative expenses. Actual factory overhead was $11,300. Required a. Record the preceding events in a horizontal statements model. The first event for Year 1 has been recorded as an example. c. Record the closing entry for over- or underapplied manufacturing overhead in the horizontal statements model, assuming that the amount is insignificant. d. Prepare a schedule of cost of goods manufactured and sold, an income statement, and a balance sheet for Year 1.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Please read the picture below and complete.
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