Ottoson Fencing Inc. uses job order costing. The following data summarize the operations related to production for December, the first month of operations: a. Materials purchased on account, $50,000. b. Materials requisitioned and factory labor used: Job 301 302 303 304 305 306 For general factory use Job Machine Hours 301 302 c. Factory overhead costs incurred on account, $1,800. d. Depreciation of machinery and equipment, $2,700. e. The factory overhead rate is $40 per machine hour. Machine hours used: 303 304 305 306 Total 30 60 41 63 70 36 Materials Factory Labor $1,850 3,150 2,200 1,900 300 4,230 1,770 1,200 $2,500 7,220 5,350 2,300 6,225 2,900 5,000 1. Jobs completed: 301, 302, 303, and 305. g. Jobs were shipped and customers were billed as follows: Job 301, $9,000; Job 302, $16,150; Job 303, $12,800. Required: 1. Journalize the entries to record the summarized operations. Record each item (items a-f) as an individual entry on December 31. Record item g as 2 entries. 2. Post the appropriate entries to T accounts for Work in Process and Finished Goods, using the identifying letters as transaction codes. Insert memo account balances as of the end of the month. 3. Prepare a schedule of unfinished jobs to support the balance in the work in process account. 4. Prepare a schedule of completed jobs on hand to support the balance in the finished goods account.
Ottoson Fencing Inc. uses job order costing. The following data summarize the operations related to production for December, the first month of operations: a. Materials purchased on account, $50,000. b. Materials requisitioned and factory labor used: Job 301 302 303 304 305 306 For general factory use Job Machine Hours 301 302 c. Factory overhead costs incurred on account, $1,800. d. Depreciation of machinery and equipment, $2,700. e. The factory overhead rate is $40 per machine hour. Machine hours used: 303 304 305 306 Total 30 60 41 63 70 36 Materials Factory Labor $1,850 3,150 2,200 1,900 300 4,230 1,770 1,200 $2,500 7,220 5,350 2,300 6,225 2,900 5,000 1. Jobs completed: 301, 302, 303, and 305. g. Jobs were shipped and customers were billed as follows: Job 301, $9,000; Job 302, $16,150; Job 303, $12,800. Required: 1. Journalize the entries to record the summarized operations. Record each item (items a-f) as an individual entry on December 31. Record item g as 2 entries. 2. Post the appropriate entries to T accounts for Work in Process and Finished Goods, using the identifying letters as transaction codes. Insert memo account balances as of the end of the month. 3. Prepare a schedule of unfinished jobs to support the balance in the work in process account. 4. Prepare a schedule of completed jobs on hand to support the balance in the finished goods account.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Concept explainers
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
Topic Video
Question
100%
Transcribed Image Text:1. Journalize the entries to record the summarized operations. Record each item (ite
entry on December 31. Record item g as 2 entries.
General Journal Instructions
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
DATE
Dec. 31 Materials
Accounts Payable
Dec. 31 Work in Process
Factory Overhead
Materials
Wages Payable
Dec. 31 Factory Overhead
Accounts Payable
Dec. 31 Factory Overhead
Dec. 31 Work in Process
Accumulated Depreciation-Machinery and Equipment
Factory Overhead
Dec. 31 Finished Goods
DESCRIPTION
Work in Process
Dec. 31 Accounts Receivable
Sales
Cost of Goods Sold
Finished Goods
JOURNAL
POST. REF.
DEBIT
50,000.00
41,595.00
1,800.00
2,700.00
12,000.00
8,040.00
CREDIT
50,000.00
6,200.00
16,300.00
31,495.00
1,800.00
2,700.00
12,000.00
8,040.00
Transcribed Image Text:Ottoson Fencing Inc. uses job order costing. The following data summarize the operations related to production for December, the first month of
operations:
a. Materials purchased on account, $50,000.
b. Materials requisitioned and factory labor used:
Job
301
302
303
304
305
306
For general factory use
Job Machine Hours
301
302
303
c. Factory overhead costs incurred on account, $1,800.
d. Depreciation of machinery and equipment, $2,700.
e. The factory overhead rate is $40 per machine hour. Machine hours used:
304
305
306
Total
30
60
41
63
70
36
Materials Factory Labor
$1,850
$2,500
3,150
2,200
1,900
4,230
1,770
1,200
300
7,220
5,350
2,300
6,225
2,900
5,000
1. Jobs completed: 301, 302, 303, and 305.
g. Jobs were shipped and customers were billed as follows: Job 301, $9,000; Job 302, $16,150; Job 303, $12,800.
Required:
1. Journalize the entries to record the summarized operations. Record each item (items a-f) as an individual entry on December 31. Record
item g as 2 entries.
2. Post the appropriate entries to T accounts for Work in Process and Finished Goods, using the identifying letters as transaction codes. Insert
memo account balances as of the end of the month.
3. Prepare a schedule of unfinished jobs to support the balance in the work in process account.
4. Prepare a schedule of completed jobs on hand to support the balance in the finished goods account.
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 7 steps with 12 images
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