Required:i)ii)Compute Fielder's predetermined manufacturing overhead rate for 2020.State the journal entries necessary to record the above transactions in the general journal:a) For direct materials used in Februaryb) For indirect material issued to production in Februaryc) For total manufacturing labour incurred in Februaryd) To assign manufacturing labour to the appropriate accountse) For other manufacturing overhead incurredf) For manufacturing overhead applied to production for February, given that Fieldermanufacturing company worked 2,750 machine hours.g) To move the completed jobs into finished goods inventoryh) To sell the two completed jobs on accountiii) Calculate the manufacturing overhead variance for Fielder and state the journal entriesnecessary to dispose of the variance.iv)What is balance on the Cost of Goods Sold account after the adjustmentv)Calculate the gross profit earned by Fielder.vi)Determine the balance in work in process inventory on February 29. The Fielder manufacturing company uses job order costing system. The company uses machinehours to apply overhead cost to jobs. At the beginning of 2020, the company estimated that 7,850machine hours would be worked and $1,256,000 overhead cost would be incurred during 2020.The following activities took place in the work in process inventory during February:WIP Inventory A/CFebruary 1 Bal.Direct Materials Usedb/f256,40051,250Other transactions incurred:• Indirect material issued to production was $38,000• Total manufacturing labour incurred in February was $345,000, 80% of this amountrepresented direct labour.• Other manufacturing overhead costs incurred for February amounted to $340,750.• Two jobs were completed with total costs of $324,000 & $240,000 respectively. They weresold on account at a margin of 40% on sales.

Name: Required:i)ii)Compute Fielder's predetermined manufacturing overhead
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Description: Required:i)ii)Compute Fielder's predetermined manufacturing overhead rate for 2020.State the journal entries necessary to record the above transactions in the general journal:a) For direct materials used in Februaryb) For indirect material issued to

Predetermined Manufacturing Overhead Rate = Estimated Overhead cost / Estimated Machine Hours

Business

Accounting

The Fielder manufacturing company uses job order costing system. The company uses machine hours to apply overhead cost to jobs. At the beginning of 2020, the company estimated that 7,850 machine hours would be worked and s1,256,000 overhead cost would be incurred during 2020. The following activities took place in the work in process inventory during February: WIP Inventory A/Cc February 1 Bal. b/f Direct Materials Used 51,250 256,400 Other transactions incurred: • Indirect material issued to production was $38,000 • Total manufacturing labour incurred in February was $345,000, 80% of this amount represented direct labour. • Other manufacturing overhead costs incurred for February amounted to s340,750. • Two jobs were completed with total costs of $324,000 & $240,000 respectively. They were sold on account at a margin of 40% on sales.

The Fielder manufacturing company uses job order costing system. The company uses machine hours to apply overhead cost to jobs. At the beginning of 2020, the company estimated that 7,850 machine hours would be worked and s1,256,000 overhead cost would be incurred during 2020. The following activities took place in the work in process inventory during February: WIP Inventory A/Cc February 1 Bal. b/f Direct Materials Used 51,250 256,400 Other transactions incurred: • Indirect material issued to production was $38,000 • Total manufacturing labour incurred in February was $345,000, 80% of this amount represented direct labour. • Other manufacturing overhead costs incurred for February amounted to s340,750. • Two jobs were completed with total costs of $324,000 & $240,000 respectively. They were sold on account at a margin of 40% on sales.

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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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Question

Required:
i)
ii)
Compute Fielder's predetermined manufacturing overhead rate for 2020.
State the journal entries necessary to record the above transactions in the general journal:
a) For direct materials used in February
b) For indirect material issued to production in February
c) For total manufacturing labour incurred in February
d) To assign manufacturing labour to the appropriate accounts
e) For other manufacturing overhead incurred
f) For manufacturing overhead applied to production for February, given that Fielder
manufacturing company worked 2,750 machine hours.
g) To move the completed jobs into finished goods inventory
h) To sell the two completed jobs on account
iii) Calculate the manufacturing overhead variance for Fielder and state the journal entries
necessary to dispose of the variance.
iv)
What is balance on the Cost of Goods Sold account after the adjustment
v)
Calculate the gross profit earned by Fielder.
vi)
Determine the balance in work in process inventory on February 29.

The Fielder manufacturing company uses job order costing system. The company uses machine
hours to apply overhead cost to jobs. At the beginning of 2020, the company estimated that 7,850
machine hours would be worked and $1,256,000 overhead cost would be incurred during 2020.
The following activities took place in the work in process inventory during February:
WIP Inventory A/C
February 1 Bal.
Direct Materials Used
b/f
256,400
51,250
Other transactions incurred:
• Indirect material issued to production was $38,000
• Total manufacturing labour incurred in February was $345,000, 80% of this amount
represented direct labour.
• Other manufacturing overhead costs incurred for February amounted to $340,750.
• Two jobs were completed with total costs of $324,000 & $240,000 respectively. They were
sold on account at a margin of 40% on sales.

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