Required information [The following information applies to the questions displayed below.] Bunnell Corporation is a manufacturer that uses job-order costing. On January 1, the company's inventory balances were as follows: Raw materials Work in process Finished goods $ 49,000 $ 28,600 $ 47,100 The company applies overhead cost to jobs using direct labor-hours. For this year, the company's predetermined overhead rate of $15.25 per direct labor-hour was based on a cost formula that estimated $610,000 of total manufacturin overhead for an estimated activity level of 40,000 direct labor-hours. The following transactions were recorded this year: a. Raw materials were purchased on account, $562,000. b. Raw materials used in production, $513,200. All of of the raw materials were used as direct materials. c. The following costs were accrued for employee services: direct labor, $560,000; indirect labor, $150,000; selling and administrative salaries, $249,000. d. Incurred various selling and administrative expenses (e.g., advertising, sales travel costs, and finished goods warehousing), $401,000. e. Incurred various manufacturing overhead costs (e.g., depreciation, insurance, and utilities), $460,000. f. Manufacturing overhead cost was applied to production. The company actually worked 41,000 direct labor-hours on a jobs during the year. g. Jobs costing $1,614,850 to manufacture according to their job cost sheets were completed during the year. h. Jobs were sold on account to customers during the year for a total of $3,397,500. The jobs cost $1,624,850 to manufacture according to their job cost sheets. Required: 1. What is the journal entry to record raw materials used in production? Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.
Required information [The following information applies to the questions displayed below.] Bunnell Corporation is a manufacturer that uses job-order costing. On January 1, the company's inventory balances were as follows: Raw materials Work in process Finished goods $ 49,000 $ 28,600 $ 47,100 The company applies overhead cost to jobs using direct labor-hours. For this year, the company's predetermined overhead rate of $15.25 per direct labor-hour was based on a cost formula that estimated $610,000 of total manufacturin overhead for an estimated activity level of 40,000 direct labor-hours. The following transactions were recorded this year: a. Raw materials were purchased on account, $562,000. b. Raw materials used in production, $513,200. All of of the raw materials were used as direct materials. c. The following costs were accrued for employee services: direct labor, $560,000; indirect labor, $150,000; selling and administrative salaries, $249,000. d. Incurred various selling and administrative expenses (e.g., advertising, sales travel costs, and finished goods warehousing), $401,000. e. Incurred various manufacturing overhead costs (e.g., depreciation, insurance, and utilities), $460,000. f. Manufacturing overhead cost was applied to production. The company actually worked 41,000 direct labor-hours on a jobs during the year. g. Jobs costing $1,614,850 to manufacture according to their job cost sheets were completed during the year. h. Jobs were sold on account to customers during the year for a total of $3,397,500. The jobs cost $1,624,850 to manufacture according to their job cost sheets. Required: 1. What is the journal entry to record raw materials used in production? Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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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.
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![Required information
[The following information applies to the questions displayed below.]
Bunnell Corporation is a manufacturer that uses job-order costing. On January 1, the company's inventory balances were
as follows:
Raw materials
Work in process
Finished goods
$ 49,000
$ 28,600
$ 47,100
The company applies overhead cost to jobs using direct labor-hours. For this year, the company's predetermined
overhead rate of $15.25 per direct labor-hour was based on a cost formula that estimated $610,000 of total manufacturing
overhead for an estimated activity level of 40,000 direct labor-hours. The following transactions were recorded this year:
a. Raw materials were purchased on account, $562,000.
b. Raw materials used in production, $513,200. All of of the raw materials were used as direct materials.
c. The following costs were accrued for employee services: direct labor, $560,000; indirect labor, $150,000; selling and
administrative salaries, $249,000.
d. Incurred various selling and administrative expenses (e.g., advertising, sales travel costs, and finished goods
warehousing), $401,000.
e. Incurred various manufacturing overhead costs (e.g., depreciation, insurance, and utilities), $460,000.
f. Manufacturing overhead cost was applied to production. The company actually worked 41,000 direct labor-hours on all
jobs during the year.
g. Jobs costing $1,614,850 to manufacture according to their job cost sheets were completed during the year.
h. Jobs were sold on account to customers during the year for a total of $3,397,500. The jobs cost $1,624,850 to
manufacture according to their job cost sheets.
Required:
1. What is the journal entry to record raw materials used in production?
Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F5f59819e-fa01-47a9-a4e3-4c9cbd32e500%2Fe3acb711-f230-4068-b994-22b8e24fcdd1%2F1owd1ei_processed.png&w=3840&q=75)
Transcribed Image Text:Required information
[The following information applies to the questions displayed below.]
Bunnell Corporation is a manufacturer that uses job-order costing. On January 1, the company's inventory balances were
as follows:
Raw materials
Work in process
Finished goods
$ 49,000
$ 28,600
$ 47,100
The company applies overhead cost to jobs using direct labor-hours. For this year, the company's predetermined
overhead rate of $15.25 per direct labor-hour was based on a cost formula that estimated $610,000 of total manufacturing
overhead for an estimated activity level of 40,000 direct labor-hours. The following transactions were recorded this year:
a. Raw materials were purchased on account, $562,000.
b. Raw materials used in production, $513,200. All of of the raw materials were used as direct materials.
c. The following costs were accrued for employee services: direct labor, $560,000; indirect labor, $150,000; selling and
administrative salaries, $249,000.
d. Incurred various selling and administrative expenses (e.g., advertising, sales travel costs, and finished goods
warehousing), $401,000.
e. Incurred various manufacturing overhead costs (e.g., depreciation, insurance, and utilities), $460,000.
f. Manufacturing overhead cost was applied to production. The company actually worked 41,000 direct labor-hours on all
jobs during the year.
g. Jobs costing $1,614,850 to manufacture according to their job cost sheets were completed during the year.
h. Jobs were sold on account to customers during the year for a total of $3,397,500. The jobs cost $1,624,850 to
manufacture according to their job cost sheets.
Required:
1. What is the journal entry to record raw materials used in production?
Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.
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