Problem 19-3A Source documents, journal entries, and accounts in job order costing LO P1, P2, P3Skip to question [The following information applies to the questions displayed below.] Widmer Watercraft’s predetermined overhead rate is 200% of direct labor. Information on the company’s production activities during May follows. Purchased raw materials on credit, $220,000.Materials requisitions record use of the following materials for the month. Job 136$49,500 Job 137 33,500 Job 138 19,200 Job 139 22,800 Job 140 6,800 Total direct materials 131,800 Indirect materials 20,500 Total materials used$152,300 Paid $15,000 cash to a computer consultant to reprogram factory equipment.Time tickets record use of the following labor for the month. These wages were paid in cash. Job 136$12,200 Job 137 10,600 Job 138 38,100 Job 139 39,000 Job 140 3,800 Total direct labor 103,700 Indirect labor 25,000 Total$128,700 Applied overhead to Jobs 136, 138, and 139.Transferred Jobs 136, 138, and 139 to Finished Goods.Sold Jobs 136 and 138 on credit at a total price of $525,000.The company incurred the following overhead costs during the month (credit Prepaid Insurance for expired factory insurance). Depreciation of factory building$68,500 Depreciation of factory equipment 38,000 Expired factory insurance 11,000 Accrued property taxes payable 35,000 Applied overhead at month-end to the Work in Process Inventory account (Jobs 137 and 140) using the predetermined overhead rate of 200% of direct labor cost. ### Journal Entries for TransactionsBelow is a table showing the preparation of journal entries to record specific events and transactions labeled from a through f.#### Transactions and Corresponding Journal Entries| No | Transaction | General Journal | Debit | Credit ||----|-------------|------------------------------|---------|---------|| 1 | a. | Raw materials inventory | 220,000 | || | | Accounts payable | | 220,000 || 2 | b. | Factory overhead | | || | | Work in process inventory | | || 3 | c. | Factory overhead | | || | | Cash | | || 4 | d. | Work in process inventory | | || | | Factory overhead | | || 5 | e. | Work in process inventory | | || | | Factory overhead | | || 6 | f. | Finished goods inventory | | || | | Work in process inventory | | |### SummaryThis table outlines the journal entries needed to accurately record these transactions. Transaction 1 involves a debit to Raw Materials Inventory and a credit to Accounts Payable, reflecting $220,000 in materials purchased on account. Transactions 2 through 6 are structured for processing and inventory management but lack specific debit and credit amounts, indicating further details may be required for these entries.### Navigation Options- **View Transaction List:** Allows users to view all transactions.- **View Journal Entry Worksheet:** Provides a worksheet format for detailed entry of each transaction.This structured approach aids in maintaining accurate financial records and ensures consistency in inventory and overhead management. The table below outlines various accounting entries typically found in a manufacturing environment, specifically dealing with inventories, overhead, and sales.| No | Entry | Description ||----|-------|-------------|| 7 | g(1). | Transactions involving Accounts Receivable and Sales are recorded. || | - | Accounts Receivable || | - | Sales || 8 | g(2). | Represents the shifting of costs associated with manufacturing items. || | - | Cost of Goods Sold || | - | Finished Goods Inventory || 9 | h. | Details the various components comprising Factory Overhead. These could include future payment liabilities and prepaid expenses related to the manufacturing infrastructure. || | - | Factory Overhead || | - | Accumulated Depreciation—Factory Building || | - | Accumulated Depreciation—Factory Equipment || | - | Property Taxes Payable || | - | Prepaid Insurance || 10 | i. | Tracks the transition of products still in production and their associated overhead costs. || | - | Work in Process Inventory || | - | Factory Overhead |This table is an essential part of understanding the flow of manufacturing costs and inventory management in accounting.

Name: Problem 19-3A Source documents, journal entries, and accounts in job o
Uploaded: 2024-03-20T06:32:49.000Z
Channel: Bartleby
Description: Problem 19-3A Source documents, journal entries, and accounts in job order costing LO P1, P2, P3Skip to question [The following information applies to the questions displayed below.] Widmer Watercraft’s predetermined overhead rate is 200% of direct l

Solution: Job No. 136 Job No. 137 Job No. 138 Job No. 139 Job No. 140 Materials $49,500.00…

Widmer Watercraft’s predetermined overhead rate is 200% of direct labor. Information on the company’s production activities during May follows. Purchased raw materials on credit, $220,000. Materials requisitions record use of the following materials for the month. Job 136 $ 49,500 Job 137 33,500 Job 138 19,200 Job 139 22,800 Job 140 6,800 Total direct materials 131,800 Indirect materials 20,500 Total materials used $ 152,300 Paid $15,000 cash to a computer consultant to reprogram factory equipment. Time tickets record use of the following labor for the month. These wages were paid in cash. Job 136 $ 12,200 Job 137 10,600 Job 138 38,100 Job 139 39,000 Job 140 3,800 Total direct labor 103,700 Indirect labor 25,000 Total $ 128,700 Applied overhead to Jobs 136, 138, and 139. Transferred Jobs 136, 138, and 139 to Finished Goods. Sold Jobs 136 and 138 on credit at a total price of $525,000. The company incurred the following overhead costs during the month (credit Prepaid Insurance for expired factory insurance). Depreciation of factory building $ 68,500 Depreciation of factory equipment 38,000 Expired factory insurance 11,000 Accrued property taxes payable 35,000 Applied overhead at month-end to the Work in Process Inventory account (Jobs 137 and 140) using the predetermined overhead rate of 200% of direct labor cost.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Problem 19-3A Source documents, journal entries, and accounts in job order costing LO P1, P2, P3

Skip to question

[The following information applies to the questions displayed below.]

Widmer Watercraft’s predetermined overhead rate is 200% of direct labor. Information on the company’s production activities during May follows.

Purchased raw materials on credit, $220,000.
Materials requisitions record use of the following materials for the month.


Job 136	$	49,500
Job 137		33,500
Job 138		19,200
Job 139		22,800
Job 140		6,800
Total direct materials		131,800
Indirect materials		20,500
Total materials used	$	152,300

Paid $15,000 cash to a computer consultant to reprogram factory equipment.
Time tickets record use of the following labor for the month. These wages were paid in cash.


Job 136	$	12,200
Job 137		10,600
Job 138		38,100
Job 139		39,000
Job 140		3,800
Total direct labor		103,700
Indirect labor		25,000
Total	$	128,700

Applied overhead to Jobs 136, 138, and 139.
Transferred Jobs 136, 138, and 139 to Finished Goods.
Sold Jobs 136 and 138 on credit at a total price of $525,000.
The company incurred the following overhead costs during the month (credit Prepaid Insurance for expired factory insurance).


Depreciation of factory building	$	68,500
Depreciation of factory equipment		38,000
Expired factory insurance		11,000
Accrued property taxes payable		35,000

Applied overhead at month-end to the Work in Process Inventory account (Jobs 137 and 140) using the predetermined overhead rate of 200% of direct labor cost.

### Journal Entries for Transactions

Below is a table showing the preparation of journal entries to record specific events and transactions labeled from a through f.

#### Transactions and Corresponding Journal Entries

| No | Transaction | General Journal | Debit | Credit |
|----|-------------|------------------------------|---------|---------|
| 1 | a. | Raw materials inventory | 220,000 | |
| | | Accounts payable | | 220,000 |
| 2 | b. | Factory overhead | | |
| | | Work in process inventory | | |
| 3 | c. | Factory overhead | | |
| | | Cash | | |
| 4 | d. | Work in process inventory | | |
| | | Factory overhead | | |
| 5 | e. | Work in process inventory | | |
| | | Factory overhead | | |
| 6 | f. | Finished goods inventory | | |
| | | Work in process inventory | | |

### Summary

This table outlines the journal entries needed to accurately record these transactions. Transaction 1 involves a debit to Raw Materials Inventory and a credit to Accounts Payable, reflecting $220,000 in materials purchased on account. Transactions 2 through 6 are structured for processing and inventory management but lack specific debit and credit amounts, indicating further details may be required for these entries.

### Navigation Options

- **View Transaction List:** Allows users to view all transactions.
- **View Journal Entry Worksheet:** Provides a worksheet format for detailed entry of each transaction.

This structured approach aids in maintaining accurate financial records and ensures consistency in inventory and overhead management.

The table below outlines various accounting entries typically found in a manufacturing environment, specifically dealing with inventories, overhead, and sales.

| No | Entry | Description |
|----|-------|-------------|
| 7 | g(1). | Transactions involving Accounts Receivable and Sales are recorded. |
| | - | Accounts Receivable |
| | - | Sales |
| 8 | g(2). | Represents the shifting of costs associated with manufacturing items. |
| | - | Cost of Goods Sold |
| | - | Finished Goods Inventory |
| 9 | h. | Details the various components comprising Factory Overhead. These could include future payment liabilities and prepaid expenses related to the manufacturing infrastructure. |
| | - | Factory Overhead |
| | - | Accumulated Depreciation—Factory Building |
| | - | Accumulated Depreciation—Factory Equipment |
| | - | Property Taxes Payable |
| | - | Prepaid Insurance |
| 10 | i. | Tracks the transition of products still in production and their associated overhead costs. |
| | - | Work in Process Inventory |
| | - | Factory Overhead |

This table is an essential part of understanding the flow of manufacturing costs and inventory management in accounting.

Expert Solution

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.