Concept explainers
1.
Prepare general journal entries to record transactions (a) through (k) and make compound entries for (b), (d), and (h), with separate debits for each job.
1.

Explanation of Solution
Job order costing is one of the methods of cost accounting under which cost is collected and gathered for each job, work order, or project separately. It is a system by which a factory maintains a separate record of each particular quantity of product that passes through the factory. Job order costing is used when the products produced are significantly different from each other.
Prepare
Date | Accounts title and explanation |
Debit ($) |
Credit ($) |
a. | Material | 45,000 | |
Accounts payable | 45,000 | ||
(To record the purchase of materials on account.) | |||
b. | Work in process | 10,000 | |
Work in process | 11,000 | ||
Work in process | 9,500 | ||
Work in process | 12,200 | ||
Materials | 42,700 | ||
(To record issuance of direct materials for the job: job no.201,202,203,204) | |||
c. | Factory | 7,500 | |
Materials | 7,500 | ||
(To record the issuance of indirect materials) | |||
d. | Work in process | 18,000 | |
Work in process | 19,000 | ||
Work in process | 20,500 | ||
Work in process | 17,500 | ||
Wages payable | 75,000 | ||
(To record direct labor incurred for the job: job no.201,202,203,204) | |||
e. | Factory overhead | 11,000 | |
Wages payable | 11,000 | ||
(To record the indirect labor charged to production) | |||
f. | Factory overhead | 7,000 | |
Cash | 7,000 | ||
(To record the payment of electricity bill, heating oil, and repairs bills for the factory and charge made to production) | |||
g. | Factory overhead | 40,000 | |
| 40,000 | ||
(To record the depreciation expense on factory equipment) | |||
h. | Work in process | 15,000 | |
Work in process | 16,500 | ||
Work in process | 16,500 | ||
Work in process | 18,000 | ||
Factory overhead | 66,000 | ||
(To record applied factory overhead to the job: job no.201,202,203,204) | |||
i. | Finished goods (Product C) | 43,000 | |
Work in process | 43,000 | ||
(To record the transfer of Job no. 201 to Product C) | |||
Finished goods (Product D) | 46,500 | ||
Work in process | 46,500 | ||
(To record the transfer of Job no.202 to Product D) | |||
Finished goods (Product E) | 46,500 | ||
Work in process | 46,500 | ||
(To record the transfer of Job no.203 to Product E) | |||
j. | Accounts receivable | 47,000 | |
Sales | 47,000 | ||
(To record sale of product C) | |||
Cost of goods sold | 43,000 | ||
Finished goods (Product C) | 43,000 | ||
(To record cost of goods sold on finished goods of Product C) | |||
Accounts receivable | 49,000 | ||
Sales | 49,000 | ||
(To record sale of product D) | |||
Cost of goods sold | 46,500 | ||
Finished goods (Product D) | 46,500 | ||
(To record cost of goods sold on finished goods of Product D) | |||
k. | Factory overhead | 500 | |
Cost of goods sold (2) | 500 | ||
(To record cost of goods sold) |
(Table 1)
Working note:
(1) Calculate the actual factory overhead:
(2) Calculate the cost of goods sold:
2.
2.

Explanation of Solution
Post the entries to the work in process and finished goods T accounts and determine the ending balances in these accounts.
3.
Compute the balance in the job cost ledger and verify whether the balance agrees with that in the work in process control account.
3.

Explanation of Solution
The balance of the job cost ledger (Job No.204) is $47,700
Want to see more full solutions like this?
Chapter 26 Solutions
COLLEGE ACCOUNTING CH. 1-9 (LOW COST)
- Quick answer of this accounting questionsarrow_forwardBlockbuster Co is building a new state of the art cineplex at a cost of $3,500,000.They received a capital investment of $1,500,000. The remainder of funds will haveto be borrowed so they decided to issue bonds. They have issued 10.5%, 5-yearbonds. These bonds were issued on January 1st, 2020, and pay semi-annual intereston July 1st and January 1st. The bonds yield 10%. The year end is December 31st Calculate the proceeds from the sale of the bond. Clearly show theamount of the premium or discount and state two reasons which supportthe premium or discount calculatedarrow_forwardGeneral accounting questionarrow_forward
- Need help with this question solution general accountingarrow_forwardBlockbuster Co is building a new state of the art cineplex at a cost of $3,500,000.They received a capital investment of $1,500,000. The remainder of funds will haveto be borrowed so they decided to issue bonds. They have issued 10.5%, 5-yearbonds. These bonds were issued on January 1st, 2020, and pay semi-annual intereston July 1st and January 1st. The bonds yield 10%. The year end is December 31starrow_forwardHi expert please give me answer general accounting questionarrow_forward
- General Accountingarrow_forwardRequired Determine whether the following items included in Wong Company’s January Year 1 bank reconciliation will require adjusting or correcting entries on Wong’s books. When an entry is required, record it in general journal format. Note: If no entry is required for a transaction or event, select "No journal entry required" in the first account field. Service charges of $50 for the month of January were listed on the bank statement. The bank charged a $250 check drawn on Wing Restaurant to Wong’s account. The check was included in Wong’s bank statement. A check of $62 was returned to the bank because of insufficient funds and was noted on the bank statement. Wong received the check from a customer and thought it was good when it was deposited into the account. A $990 deposit was recorded by the bank as $980. Four checks totaling $810 written during the month of January were not included with the January bank statement. A $75 check written to OfficeMax for office supplies was…arrow_forwardTotal assets at the year end?arrow_forward
- Please give me true answer this financial accounting questionarrow_forwardcritically analyze the effectiveness of the tax system in Jamaica with a brief history of the tax system highlight the different types of taxes used in the country and identify and discuss 4 problems with the Jamaican tax system.arrow_forwardSolve my problemarrow_forward
- Principles of Cost AccountingAccountingISBN:9781305087408Author:Edward J. Vanderbeck, Maria R. MitchellPublisher:Cengage LearningCollege Accounting, Chapters 1-27AccountingISBN:9781337794756Author:HEINTZ, James A.Publisher:Cengage Learning,College Accounting, Chapters 1-27 (New in Account...AccountingISBN:9781305666160Author:James A. Heintz, Robert W. ParryPublisher:Cengage Learning
- Managerial AccountingAccountingISBN:9781337912020Author:Carl Warren, Ph.d. Cma William B. TaylerPublisher:South-Western College PubPrinciples of Accounting Volume 2AccountingISBN:9781947172609Author:OpenStaxPublisher:OpenStax CollegeManagerial Accounting: The Cornerstone of Busines...AccountingISBN:9781337115773Author:Maryanne M. Mowen, Don R. Hansen, Dan L. HeitgerPublisher:Cengage Learning




