The following T-accounts represent September activity for Kelly Tools: Work-in-Process Inventory Materials Inventory Debit Credit Debit Credit Beginning Ending Balance 25,700 Balance 43,600 (9/30) (9/1) Direct 121,600 Labor Cost of Goods Sold Debit Credit Manufacturing Overhead Applied Debit Credit 133,350 Wages Payable Sales Revenue Debit Credit Debit Credit 542,500 Finished Goods Inventory Debit Credit Ending Balance 71,300 (9/30) Manufacturing Overhead Control Debit Credit Additional Data • Sales are billed at 175 percent of Cost of Goods Sold before the over- or underapplied overhead is prorated. • Materials of $83,700 were purchased during the month, and the balance in the Materials Inventory account increased by $9,300 • Overhead is applied at the rate of 210 percent of direct materials cost. • The balance in the Finished Goods Inventory account decreased by $25,100 during the month before any proration of under- or overapplied overhead. • Total credits to the Wages Payable account amounted to $140,700 for direct and indirect labor. • Factory depreciation totaled $38,100. • Overhead was overapplied by $20,800. Overhead other than indirect labor, indirect materials, and depreciation incurred was $60,250, which required payment in cash. Overapplied overhead is to be allocated. The company has decided to allocate 12 percent of overapplied overhead to Work-in-Process Inventory, 23 percent to Finished Goods Inventory, and the balance to Cost of Goods Sold. Balances shown in T-accounts are before any allocation. Required: Complete the T-accounts. Not all amount fields to be populated have accompanying descriptions.
The following T-accounts represent September activity for Kelly Tools: Work-in-Process Inventory Materials Inventory Debit Credit Debit Credit Beginning Ending Balance 25,700 Balance 43,600 (9/30) (9/1) Direct 121,600 Labor Cost of Goods Sold Debit Credit Manufacturing Overhead Applied Debit Credit 133,350 Wages Payable Sales Revenue Debit Credit Debit Credit 542,500 Finished Goods Inventory Debit Credit Ending Balance 71,300 (9/30) Manufacturing Overhead Control Debit Credit Additional Data • Sales are billed at 175 percent of Cost of Goods Sold before the over- or underapplied overhead is prorated. • Materials of $83,700 were purchased during the month, and the balance in the Materials Inventory account increased by $9,300 • Overhead is applied at the rate of 210 percent of direct materials cost. • The balance in the Finished Goods Inventory account decreased by $25,100 during the month before any proration of under- or overapplied overhead. • Total credits to the Wages Payable account amounted to $140,700 for direct and indirect labor. • Factory depreciation totaled $38,100. • Overhead was overapplied by $20,800. Overhead other than indirect labor, indirect materials, and depreciation incurred was $60,250, which required payment in cash. Overapplied overhead is to be allocated. The company has decided to allocate 12 percent of overapplied overhead to Work-in-Process Inventory, 23 percent to Finished Goods Inventory, and the balance to Cost of Goods Sold. Balances shown in T-accounts are before any allocation. Required: Complete the T-accounts. Not all amount fields to be populated have accompanying descriptions.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Transcribed Image Text:The following T-accounts represent September activity for Kelly Tools:
Work-in-Process Inventory
Materials Inventory
Debit
Credit
Debit
Credit
Beginning
Ending
Balance
25,700
Balance 43,600
(9/30)
(9/1)
Direct
121,600
Labor
Cost of Goods Sold
Debit
Credit
Manufacturing Overhead Applied
Debit
Credit
133,350
Wages Payable
Sales Revenue
Debit
Credit
Debit
Credit
542,500
Finished Goods Inventory
Debit
Credit
Ending
Balance 71,300
(9/30)
Manufacturing Overhead Control
Debit
Credit
Additional Data
• Sales are billed at 175 percent of Cost of Goods Sold before the over- or underapplied overhead is prorated.
• Materials of $83,700 were purchased during the month, and the balance in the Materials Inventory account increased by $9,300
• Overhead is applied at the rate of 210 percent of direct materials cost.
• The balance in the Finished Goods Inventory account decreased by $25,100 during the month before any proration of under- or
overapplied overhead.
• Total credits to the Wages Payable account amounted to $140,700 for direct and indirect labor.
• Factory depreciation totaled $38,100.
• Overhead was overapplied by $20,800. Overhead other than indirect labor, indirect materials, and depreciation incurred was
$60,250, which required payment in cash. Overapplied overhead is to be allocated.
The company has decided to allocate 12 percent of overapplied overhead to Work-in-Process Inventory, 23 percent to Finished
Goods Inventory, and the balance to Cost of Goods Sold. Balances shown in T-accounts are before any allocation.
Required:
Complete the T-accounts. Not all amount fields to be populated have accompanying descriptions.
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