Managerial Accounting
3rd Edition
ISBN: 9780077826482
Author: Stacey M Whitecotton Associate Professor, Robert Libby, Fred Phillips Associate Professor
Publisher: McGraw-Hill Education
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Chapter 2, Problem 18E
To determine
(a)
Introduction:
In cost accounting, various production stages of manufacturing a product are identified. Thus, manufacturing costs are recorded at such production processes to reflect appropriate apportionment of costs.
To record:
The transactions in T-shape accounts.
Expert Solution
Explanation of Solution
Raw Materials Inventory:
| Particulars | $ (Debit) | Particulars | $ (Credit) |
| (a) Purchases | 20,000 | (b) Materials issued (job 201) | 12,000 |
| (b) Materials issued (job 201) | 21,000 | ||
| (b) Indirect materials | 3,200 |
Work in process Inventory
| Particulars | $ (Debit) | Particulars | $ (Credit) |
| (b) Materials issued (job 201) | 12,000 | ||
| (b) Materials issued (job 202) | 21,000 | ||
| (c) Direct labor (job 201) | 2,150 | ||
| (c) Direct labor (job 202) | 10,750 | ||
| (d) Applied |
15,000 |
Finished Goods Inventory:
| Particulars | $ (Debit) | Particulars | $ (Credit) |
| Completed and transferred (job 201) | 16,650 |
Manufacturing Overhead:
| Particulars | $ (Debit) | Particulars | $ (Credit) |
| (b) Indirect materials | 3,200 | (d) Applied overhead (600×$25) | 15,000 |
| (c) Factory supervision | 5,000 |
Sales Revenue:
| Particulars | $ (Debit) | Particulars | $ (Credit) |
| (i) Sales (job 200) | 31,000 |
To determine
(b)
Introduction:
Manufacturing Costs:
In cost accounting, various production stages of manufacturing a product are identified. Thus, manufacturing costs are recorded at such production processes to reflect appropriate apportionment of costs.
To prepare:
The T-accounts and calculate their ending balances.
Expert Solution
Explanation of Solution
Raw Materials Inventory:
| Particulars | $ (Debit) | Particulars | $ (Credit) |
| Opening Balance | 32,000 | (b) Materials issued (job 201) | 12,000 |
| (a) Purchases | 20,000 | (b) Materials issued (job 202) | 21,000 |
| (b) Indirect materials | 3,200 | ||
| Closing Balance | 15,800 | ||
| 52,000 | 52,000 | ||
| Opening Balance | 15,800 |
Work in process Inventory
| Particulars | $ (Debit) | Particulars | $ (Credit) |
| Opening Balance | 15,500 | (f) Completed and transferred to finished goods (Job 201) | 16,650 |
| (b) Materials issued (job 201) | 12,000 | Closing Balance | 59,750 |
| (b) Materials issued (job 202) | 21,000 | ||
| (c) Direct labor (job 201) | 2,150 | ||
| (c) Direct labor (job 202) | 10,750 | ||
| (d) Applied overhead (100×$25) | 2,500 | ||
| (d) Applied overhead (500×$25) | 12,500 | ||
| 76,400 | 76,400 | ||
| Opening Balance | 59,750 |
Finished Goods Inventory:
| Particulars | $ (Debit) | Particulars | $ (Credit) |
| Opening Balance | 20,000 | Closing Balance | 34,150 |
| (f) Completed and transferred (job 201) | 14,150 | ||
| 34,150 | 34,150 | ||
| Opening Balance | 34,150 |
Manufacturing Overhead:
| Particulars | $ (Debit) | Particulars | $ (Credit) |
| (b) Indirect materials | 3,200 | (d) Applied overhead (600×$25) | 15,000 |
| (c) Factory supervision | 5,000 | ||
| Closing Balance | 6,800 | ||
| 15,000 | 15,000 | ||
| Over applied | 6,800 |
Cost of Goods Sold:
(As per the question, there are no details available regarding the cost of sale of Job 200. Hence, it has been left unbalanced based on the available information.)
| Particulars | $ (Debit) | Particulars | $ (Credit) |
| Over applied | 6,800 |
Miscellaneous Accounts:
| Particulars | $ (Debit) | Particulars | $ (Credit) |
| (e) Factory rent | 3,100 | (e) Factory insurance | 1,250 |
| (e) |
2,500 | Closing Balance | 6,100 |
| (e) Factory utilities | 1,750 | ||
| 7,350 | 7,350 | ||
| Opening Balance | 6,100 |
Sales Revenue:
| Particulars | $ (Debit) | Particulars | $ (Credit) |
| Closing Balance | 31,000 | (g) Sales (job 200) | 31,000 |
| 31,000 | 31,000 | ||
| Opening Balance | 31,000 |
To determine
(c)
Introduction:
Manufacturing Costs:
In cost accounting, various production stages of manufacturing a product are identified. Thus, manufacturing costs are recorded at such production processes to reflect appropriate apportionment of costs.
To calculate:
The cost of goods manufactured.
Expert Solution
Explanation of Solution
Cost of Goods Manufactured (For Job 201 and 202)
(As per the question, the ratio of both the jobs isn’t available to segregate the purchases, use of indirect materials and various other factors. Thus, the question has been solved considering all the values equally for each job.)
| Particulars | Job 201 ($) | Job 202 ($) |
| Beginning raw material inventory | 32,000 | 32,000 |
| (+) Raw material purchases | 10,000 | 10,000 |
| (-) Indirect materials | (1,600) | (1,600) |
| (-) Ending raw material inventory | (28,400) | (19,400) |
| Direct material used | 20,400 | 21,000 |
| Direct labor | 2,150 | 10,750 |
| Manufacturing overhead applied | 2,500 | 12,500 |
| Total current manufacturing costs | 26,650 | 44,750 |
| (+) Beginning work in process inventory | 15,500 | 15,500 |
| (-) Ending work in process inventory | (16,550) | (44,250) |
| Cost of goods manufactured. | 14,000 | 16,000 |
The cost of goods manufactured are shown in the ‘cost of goods sold’ account to calculate the adjusted cost of goods sold and determine the profit, thereof.
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Chapter 2 Solutions
Managerial Accounting
Ch. 2 - What is the difference between job order and...Ch. 2 - What types of companies are likely to use job...Ch. 2 - What types companies are likely to use process...Ch. 2 - Many service industries use job order costing to...Ch. 2 - Prob. 5QCh. 2 - Prob. 6QCh. 2 - Prob. 7QCh. 2 - Prob. 8QCh. 2 - Prob. 9QCh. 2 - Prob. 10Q
Ch. 2 - Prob. 11QCh. 2 - Prob. 12QCh. 2 - Prob. 13QCh. 2 - Prob. 14QCh. 2 - Prob. 15QCh. 2 - Prob. 16QCh. 2 - Prob. 17QCh. 2 - Prob. 18QCh. 2 - Prob. 19QCh. 2 - Prob. 20QCh. 2 - Prob. 21QCh. 2 - Prob. 1MCCh. 2 - Prob. 2MCCh. 2 - Prob. 3MCCh. 2 - Prob. 4MCCh. 2 - Prob. 5MCCh. 2 - Prob. 6MCCh. 2 - Prob. 7MCCh. 2 - Applied overhead costs are recorded a. On the left...Ch. 2 - Prob. 9MCCh. 2 - Prob. 10MCCh. 2 - Identifying Companies That Use Job Order versus...Ch. 2 - Prob. 2MECh. 2 - Prob. 3MECh. 2 - Prob. 4MECh. 2 - Prob. 5MECh. 2 - Prob. 6MECh. 2 - Prob. 7MECh. 2 - Prob. 8MECh. 2 - Prob. 9MECh. 2 - Prob. 10MECh. 2 - Prob. 11MECh. 2 - Calculating Over- or Underapplied Overhead Costs...Ch. 2 - Prob. 13MECh. 2 - Prob. 14MECh. 2 - Prob. 15MECh. 2 - Calculating Direct Materials Used in Production...Ch. 2 - Calculating Missing Amounts and Cost or Goods...Ch. 2 - Prob. 19MECh. 2 - Prob. 1ECh. 2 - Preparing Journal Entries Refer to the information...Ch. 2 - Prob. 3ECh. 2 - Preparing Journal Entries Refer to the information...Ch. 2 - Prob. 5ECh. 2 - Finding Unknown Values in the Cost of Goods...Ch. 2 - Prob. 7ECh. 2 - Prob. 8ECh. 2 - Prob. 9ECh. 2 - Prob. 10ECh. 2 - Calculating the Cost of Finished and Unfinished...Ch. 2 - Computing Overhead Rate and Billing Rate for...Ch. 2 - Prob. 13ECh. 2 - Prob. 14ECh. 2 - Prob. 15ECh. 2 - Prob. 16ECh. 2 - Prob. 17ECh. 2 - Prob. 18ECh. 2 - Prob. 19ECh. 2 - Prob. 20ECh. 2 - Prob. 21ECh. 2 - Preparing Journal Entries Floyds Auto Repair Shop...Ch. 2 - Applying Job Order Costing in a Service Setting...Ch. 2 - Prob. 24ECh. 2 - Prob. 1.1GAPCh. 2 - Prob. 1.2GAPCh. 2 - Prob. 1.3GAPCh. 2 - Prob. 1.4GAPCh. 2 - Prob. 1.5GAPCh. 2 - Preparing Journal Entries Refer to the information...Ch. 2 - Prob. 3.1GAPCh. 2 - Prob. 3.2GAPCh. 2 - Prob. 3.3GAPCh. 2 - Prob. 3.4GAPCh. 2 - Prob. 3.5GAPCh. 2 - Prob. 4.1GAPCh. 2 - Prob. 4.2GAPCh. 2 - Prob. 4.3GAPCh. 2 - Prob. 5.1GAPCh. 2 - Prob. 5.2GAPCh. 2 - Recording Manufacturing Costs and Analyzing...Ch. 2 - Prob. 5.4GAPCh. 2 - Prob. 6GAPCh. 2 - Prob. 7.1GAPCh. 2 - Prob. 7.2GAPCh. 2 - Prob. 7.3GAPCh. 2 - Prob. 7.4GAPCh. 2 - Prob. 7.5GAPCh. 2 - Prob. 8.1GAPCh. 2 - Prob. 8.2GAPCh. 2 - Prob. 8.3GAPCh. 2 - Prob. 8.4GAPCh. 2 - Prob. 8.5GAPCh. 2 - Prob. 1.1GBPCh. 2 - Prob. 1.2GBPCh. 2 - Prob. 1.3GBPCh. 2 - Prob. 1.4GBPCh. 2 - Prob. 1.5GBPCh. 2 - Prob. 2GBPCh. 2 - Prob. 3.1GBPCh. 2 - Prob. 3.2GBPCh. 2 - Prob. 3.3GBPCh. 2 - Prob. 3.4GBPCh. 2 - Prob. 3.5GBPCh. 2 - Prob. 4.1GBPCh. 2 - Prob. 4.2GBPCh. 2 - Prob. 4.3GBPCh. 2 - Recording Manufacturing Costs and Analyzing...Ch. 2 - Recording Manufacturing Costs and Analyzing...Ch. 2 - Recording Manufacturing Costs and Analyzing...Ch. 2 - Prob. 5.4GBPCh. 2 - Prob. 6GBPCh. 2 - Prob. 7.1GBPCh. 2 - Prob. 7.2GBPCh. 2 - Prob. 7.3GBPCh. 2 - Prob. 7.4GBPCh. 2 - Prob. 7.5GBPCh. 2 - Prob. 8.1GBPCh. 2 - Prob. 8.2GBPCh. 2 - Prob. 8.3GBPCh. 2 - Prob. 8.4GBPCh. 2 - Prob. 8.5GBP
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