he Polaris Company uses a job-order costing system. The following transactions occurred in October:Raw materials purchased on account, $210,000.Raw materials used in production, $188,000 ($150,400 direct materials and $37,600 indirect materials).Accrued direct labor cost of $49,000 and indirect labor cost of $22,000.Depreciation recorded on factory equipment, $105,000.Other manufacturing overhead costs accrued during October, $131,000.The company applies manufacturing overhead cost to production using a predetermined rate of $6 per machine-hour. Atotal of 76,100 machine-hours were used in October.Jobs costing $511,000 according to their job cost sheets were completed during October and transferred to FinishedGoods.Jobs that had cost $447,000 to complete according to their job cost sheets were shipped to customers during the month.These jobs were sold on account at 38% above cost.equired:Prepare journal entries to record the transactions given above.Prepare T-accounts for Manufacturing Overhead and Work in Process. Post the relevant transactions from above to eachccount. Compute the ending balance in each account, assuming that Work in Process has a beginning balance of $34,000.

In job order costing systems, the steps to arrive at the cost for a specific job are as below.1.…

sed on account, $210,000. production, $188,000 ($150,400 direct materials and $37,6C cost of $49,000 and indirect labor cost of $22,000. don factory equipment, $105,000. Overhead costs accrued during October, $131,000. manufacturing overhead cost to production using a predete e-hours were used in October. according to their job cost sheets were completed during C 47,000 to complete according to their job cost sheets were on account at 38% above cost.

sed on account, $210,000. production, $188,000 ($150,400 direct materials and $37,6C cost of $49,000 and indirect labor cost of $22,000. don factory equipment, $105,000. Overhead costs accrued during October, $131,000. manufacturing overhead cost to production using a predete e-hours were used in October. according to their job cost sheets were completed during C 47,000 to complete according to their job cost sheets were on account at 38% above cost.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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Concept explainers

Manufacturing Costs

Manufacturing cost is the total cost of procuring or producing a product. In other words, the manufacturing cost is the cost that an individual or business owner undertakes for the manufacturing of goods.

Question

he Polaris Company uses a job-order costing system. The following transactions occurred in October:
Raw materials purchased on account, $210,000.
Raw materials used in production, $188,000 ($150,400 direct materials and $37,600 indirect materials).
Accrued direct labor cost of $49,000 and indirect labor cost of $22,000.
Depreciation recorded on factory equipment, $105,000.
Other manufacturing overhead costs accrued during October, $131,000.
The company applies manufacturing overhead cost to production using a predetermined rate of $6 per machine-hour. A
total of 76,100 machine-hours were used in October.
Jobs costing $511,000 according to their job cost sheets were completed during October and transferred to Finished
Goods.
Jobs that had cost $447,000 to complete according to their job cost sheets were shipped to customers during the month.
These jobs were sold on account at 38% above cost.
equired:
Prepare journal entries to record the transactions given above.
Prepare T-accounts for Manufacturing Overhead and Work in Process. Post the relevant transactions from above to each
ccount. Compute the ending balance in each account, assuming that Work in Process has a beginning balance of $34,000.

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