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FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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# Job Order Costing System for ADT Company The following information is available for ADT Company, which produces special-order security products and uses a job order costing system. Overhead is applied using a predetermined overhead rate of 55% of the direct labor cost. ## Inventories | Inventory Type | Beginning of Period | End of Period | |---------------------|---------------------|---------------| | Raw materials | $48,000 | $43,000 | | Work in process | $9,000 | $20,700 | | Finished goods | $65,000 | $34,900 | ## Cost Incurred for the Period - Raw materials purchases: $179,000 - Factory payroll: $250,000 - Factory overhead (actual): - Indirect materials used: $12,000 - Indirect labor used: $57,500 - Other overhead costs: $114,500 **Explanation:** This document outlines inventory levels at the start and end of a particular period, as well as costs incurred during that period for ADT Company. It is designed to assist in analyzing manufacturing costs and determining the applied overhead based on the given percentage.
Transcribed Image Text:# Job Order Costing System for ADT Company The following information is available for ADT Company, which produces special-order security products and uses a job order costing system. Overhead is applied using a predetermined overhead rate of 55% of the direct labor cost. ## Inventories | Inventory Type | Beginning of Period | End of Period | |---------------------|---------------------|---------------| | Raw materials | $48,000 | $43,000 | | Work in process | $9,000 | $20,700 | | Finished goods | $65,000 | $34,900 | ## Cost Incurred for the Period - Raw materials purchases: $179,000 - Factory payroll: $250,000 - Factory overhead (actual): - Indirect materials used: $12,000 - Indirect labor used: $57,500 - Other overhead costs: $114,500 **Explanation:** This document outlines inventory levels at the start and end of a particular period, as well as costs incurred during that period for ADT Company. It is designed to assist in analyzing manufacturing costs and determining the applied overhead based on the given percentage.
### Journal Entries for Overhead Costs 1. **Incurred other actual overhead costs** (all paid in Cash). 2. **Applied overhead** to work in process. Prepare journal entries for the above transactions for the period. **Journal Entry Worksheet** - **Tabs**: A (current), B (next) **Instruction**: Record the entry for other actual overhead costs incurred (all paid in Cash). **Note**: Enter debits before credits. **Journal Table Structure**: | Transaction | General Journal | Debit | Credit | |-------------|-----------------|-------|--------| | 1 | | | | | | | | | | | | | | | | | | | | | | | | **Buttons**: - **Record entry** - **Clear entry** - **View general journal** This worksheet is used to input and manage journal entries related to overhead costs, ensuring accurate financial recording practices.
Transcribed Image Text:### Journal Entries for Overhead Costs 1. **Incurred other actual overhead costs** (all paid in Cash). 2. **Applied overhead** to work in process. Prepare journal entries for the above transactions for the period. **Journal Entry Worksheet** - **Tabs**: A (current), B (next) **Instruction**: Record the entry for other actual overhead costs incurred (all paid in Cash). **Note**: Enter debits before credits. **Journal Table Structure**: | Transaction | General Journal | Debit | Credit | |-------------|-----------------|-------|--------| | 1 | | | | | | | | | | | | | | | | | | | | | | | | **Buttons**: - **Record entry** - **Clear entry** - **View general journal** This worksheet is used to input and manage journal entries related to overhead costs, ensuring accurate financial recording practices.
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