Balance Sheet Assets Stockholders' Equity Manufacturing Cash Overhead Raw Material Work In Process Finished Goods Liabilities Common Stock Retained Earnings Revenue 50,000 + + 50,000 + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + Income Statement Expenses Net Income Check Stuart Corporation makes custom - order furniture to meet the needs of persons with disabilities. On January 1, Year 2, the company had the following account balances: $87,000 for both cash and common stock. In Year 2, Stuart worked on three jobs. The relevant direct operating costs follow. Stuart's predetermined manufacturing overhead rate was $0.40 per direct labor dollar. Actual manufacturing overhead costs amounted to $5,862. Stuart paid cash for all costs. The company completed and delivered Jobs 1 and 2 to customers during the year. Job 3 was incomplete at the end of the year. The company sold Job 1 for $16, 200 cash and Job 2 for $8, 200 cash. Stuart also paid $3,200 cash for selling and administrative expenses for the year. Stuart uses a just-in-time inventory management system. Consequently, it does not have raw materials inventory. Raw materials purchases are recorded directly in the Work in Process Inventory account. Required Record the preceding events in a horizontal statements model. The first row shows beginning balances. Record the entry to close the amount of underapplied or overapplied overhead for the year to Cost of Goods Sold (in the expense category) in the horizontal financial statements model. Determine the gross margin for the year. The picture attached is an example of the table that corresponds with answering part a,) and b.). In the table for my question 87,000 is in the cash and common stock box's not the 50,000 seen in picture provided.
Balance Sheet Assets Stockholders' Equity Manufacturing Cash Overhead Raw Material Work In Process Finished Goods Liabilities Common Stock Retained Earnings Revenue 50,000 + + 50,000 + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + + Income Statement Expenses Net Income Check Stuart Corporation makes custom - order furniture to meet the needs of persons with disabilities. On January 1, Year 2, the company had the following account balances: $87,000 for both cash and common stock. In Year 2, Stuart worked on three jobs. The relevant direct operating costs follow. Stuart's predetermined manufacturing overhead rate was $0.40 per direct labor dollar. Actual manufacturing overhead costs amounted to $5,862. Stuart paid cash for all costs. The company completed and delivered Jobs 1 and 2 to customers during the year. Job 3 was incomplete at the end of the year. The company sold Job 1 for $16, 200 cash and Job 2 for $8, 200 cash. Stuart also paid $3,200 cash for selling and administrative expenses for the year. Stuart uses a just-in-time inventory management system. Consequently, it does not have raw materials inventory. Raw materials purchases are recorded directly in the Work in Process Inventory account. Required Record the preceding events in a horizontal statements model. The first row shows beginning balances. Record the entry to close the amount of underapplied or overapplied overhead for the year to Cost of Goods Sold (in the expense category) in the horizontal financial statements model. Determine the gross margin for the year. The picture attached is an example of the table that corresponds with answering part a,) and b.). In the table for my question 87,000 is in the cash and common stock box's not the 50,000 seen in picture provided.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text:Balance Sheet
Assets
Stockholders' Equity
Manufacturing
Cash
Overhead
Raw
Material
Work In
Process
Finished
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Earnings
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Income Statement
Expenses
Net Income
Check
Transcribed Image Text:Stuart Corporation makes custom - order furniture to meet the needs of persons with disabilities. On January 1, Year 2, the company had the following account balances: $87,000 for both cash and
common stock. In Year 2, Stuart worked on three jobs. The relevant direct operating costs follow. Stuart's predetermined manufacturing overhead rate was $0.40 per direct labor dollar. Actual
manufacturing overhead costs amounted to $5,862. Stuart paid cash for all costs. The company completed and delivered Jobs 1 and 2 to customers during the year. Job 3 was incomplete at the end of
the year. The company sold Job 1 for $16, 200 cash and Job 2 for $8, 200 cash. Stuart also paid $3,200 cash for selling and administrative expenses for the year.
Stuart uses a just-in-time inventory management system. Consequently, it does not have raw materials inventory. Raw materials purchases are recorded directly in the Work in Process Inventory
account.
Required
Record the preceding events in a horizontal statements model. The first row shows beginning balances.
Record the entry to close the amount of underapplied or overapplied overhead for the year to Cost of Goods Sold (in the expense category) in the horizontal financial statements model.
Determine the gross margin for the year.
The picture attached is an example of the table that corresponds with answering part a,) and b.). In the table for my question 87,000 is in the cash and common stock box's not the 50,000 seen in
picture provided.
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