EXERCISE 3-23 (10 MINUTES)

Similar documents
AGENDA: JOB-ORDER COSTING

Chapter 4. Systems Design: Process Costing. Types of Costing Systems Used to Determine Product Costs

n System Design Job Order Costing n What is Product Costing n Types of Product Costing n When and how to use Job-Order Costing McGraw-Hill /Irwin

Job-order Costing; T-Accounts; Income Statement

There are two basic types of cost accounting systems:

McGraw-Hill /Irwin 2-2 A company produces many units of a single product. One unit of product is indistinguishable from other units of product.

JOB ORDER COST 10 SYSTEMS AND OVERHEAD ALLOCATIONS

Exam 1 Chapters 1-3 Key

CHAPTER 9. Cost accounting systems CONTENTS

Quiz Chapter 3 - Solutions. 1. The manufacturing operation that would be most likely to use a job-order costing system is:

Module 2: Job-order costing

REVIEW FOR EXAM NO. 1, ACCT-2302 (SAC) (Chapters 16-18)

Exercise 17-1 (15 minutes)

Chapter 3 Notes Page 1

Dutchess Community College ACC 204 Managerial Accounting Quiz Prep Chapter 2

The Basic Framework of Budgeting

Lanen 3e, Chapter 7: Job Costing Practice Quiz

Accounting Building Business Skills. Learning Objectives: Learning Objectives: Paul D. Kimmel. Chapter Thirteen: Cost Accounting Systems

CHAPTER 9 Profit Planning and Activity-Based Budgeting

ESERCIZI. 1 PREDETERMINED OVERHEAD RATE, OVERHEAD APPLICATION At the beginning of the year, Kreskin Company estimated the following costs:

Analysis of Inventories. Inventory: Asset or Expense?

STUDENT NAME: STUDENT ID:

Classification of Manufacturing Costs and Expenses

2-8. Identify whether each of the following items increases or decreases cash flow:

STUDENT NAME: STUDENT ID: UWDIR/Quest Id:

CHAPTER 20. Job Order Cost Accounting ASSIGNMENT CLASSIFICATION TABLE. Brief. A Problems. B Problems

Dr. Baldwin AC 314 Chapter 2

Appendix 8A. General Ledger Entries to Record Variances. Direct Materials Variances. Direct Labour Variances

Instructions for E-PLAN Financial Planning Template

Chapter 5 Merchandising Operations

SECTION IX. ACCOUNTING FOR INVENTORY

The Measurement of the Business Income. 1 by recording revenues when earned and expenses when incurred. 2 by adjusting accounts

process-costing method used. Therefore, step 1 is identical under the weighted-average and FIFO methods. See Exhibit 4 5 in the text.

REVIEW FOR FINAL EXAM, ACCT-2302 (SAC)

1. a. and b. Absorption Costing

29.1 COST SHEET : MEANING AND ITS IMPORTANCE

Absorption Costing - Overview

Lesson 5: Inventory. 5.1 Introduction. 5.2 Manufacturer or Retailer?

VOLUME 4, CHAPTER 20: JOB ORDER COST ACCOUNTING SUMMARY OF MAJOR CHANGES. All changes are denoted by blue font.

Systems design: job-order costing

Please see current textbook prices at

The Nature of Accounting Systems

Cost Concepts and Behavior

Multiple Choice Questions (45%)

Financial Statements for Manufacturing Businesses

Lesson FA a. Job Cost Accounting System Part 1a

CHAPTER 10 In-Class QUIZ

Accounting for a Merchandising Business

MANUFACTURING ACCOUNTS PRODUCTION COST STATEMENTS / BREAK-EVEN ANALYSIS CALCULATION

Chapter 5. Accounting for merchandising operations. Appendix 5A: Periodic inventory system

COST CLASSIFICATION AND COST BEHAVIOR INTRODUCTION

ACG 3024 Accounting for Non-Financial Majors Homework Portfolio Study Guide

Principles of Cost Accounting, 16th Edition, Edward J. VanDerbeck, 2013 Cengage Learning. All Rights Reserved. May not be copied, scanned, or

Merchandising Operations

Merchandise Inventory, Cost of Goods Sold, and Gross Profit. Pr. Zoubida SAMLAL

Society of Certified Management Accountants of Sri Lanka

Chapter 6. An advantage of the periodic method is that it is a easy system to maintain.

UNDERSTANDING WHERE YOU STAND. A Simple Guide to Your Company s Financial Statements

Pool Canvas. Question 1 Multiple Choice 0 points Modify Remove. Question 2 Multiple Choice 0 points Modify Remove

Job Order Costing YOUR LEARNING OBJECTIVES CHAPTER

Module 3 - Inventory Definitions

JOHNSON GRADUATE SCHOOL OF MANAGEMENT Cornell University

Working Capital Concept & Animation

CHAPTER 9 WHAT IS REPORTED AS INVENTORY? WHAT IS INVENTORY? COST OF GOODS SOLD AND INVENTORY

ACC 561 Week 3 Assignment Practice Quiz

Copyright 2015 Pearson Canada Inc. 1

House Published on

Introduction To Cost Accounting

RAPID REVIEW Chapter Content

RENAISSANCE ENTREPRENEURSHIP CENTER First Finance Class (FIN-1)

LEBANESE ASSOCIATION OF CERTIFIED PUBLIC ACCOUNTANTS MANAGERIAL ACCOUNTING

CHAPTER 12. Cost Sheet ( or) Statement of Cost ELEMENTS OF COST

This Chapter Addresses the Following Questions:

1. Managerial accounting: A. is governed by generally accepted accounting principles. B. places emphasis on special-purpose information.

Gleim / Flesher CMA Review 15th Edition, 1st Printing Part 1 Updates

1. Merchandising company VS Service company V.S Manufacturing company

Comprehensive Business Budgeting

Budget types. CH 6: Budgets HOW DO YOU COME UP WITH THE NUMBERS? Budget Periods WHY BUDGET?

Mc Graw Hill Education

CSUN GATEWAY. Managerial Accounting Study Guide

CHAPTER19. Acct202. Managerial Accounting 19-1

Guide to Financial Ratios Analysis A Step by Step Guide to Balance Sheet and Profit and Loss Statement Analysis

Principles of Managerial Accounting ACC-102-TE. TECEP Test Description

Understanding Financial Statements. For Your Business

Audit of the Inventory and Warehousing Cycle

Income Measurement and Profitability Analysis

THEME: ACCOUNTING FOR INVENTORY

02.Murray Company debited Prepaid Insurance for $960 on July 1, 1998 for a one-year

CHAPTER 3. BE3-2 Advertising. Dec. 31 Advertising Supplies Expense 7200 Advertising Supplies 7200 to adjust. BE3-3 Bere Co.

Chapter 5 Accounting for Merchandising Operations

Week 9/ 10, Chap7 Accounting 1A, Financial Accounting

Chapter 4. Completing the accounting cycle. Appendix 4A: Reversing entries

Chapter 8 Inventories: Measurement

Accounting for Manufacturing

MGT402 - Cost & Management Accounting Glossary For Final Term Exam Preparation

AAT LEVEL 3 LESSON 7. Association of Accounting Technicians (AAT) Example Course Materials

Quiz Chapter 7 - Solution

This is How Is Job Costing Used to Track Production Costs?, chapter 2 from the book Accounting for Managers (index.html) (v. 1.0).

Learning Module 3 Journal Entries

Accrual Accounting and the Financial Statements

Transcription:

Solution to Chapter 3 E3 23,24,26,28,30, E3 38,31,33, P3 45 EXERCISE 3-23 (10 MINUTES) 1. Process 2. Job-order 3. Job-order (contracts or projects) 4. Process 5. Process 6. Job-order 7. Process 8. Job-order (contracts or projects) 9. Process 10. Job-order EXERCISE 3-24 (20 MINUTES) 1. Raw-material inventory, January 1... $174,200 Add: Raw-material purchases... 248,300 Raw material available for use... $422,500 Deduct: Raw-material inventory, January 31... 161,200 Raw material used in January... $261,300 Direct labor... 390,000 Total prime costs incurred in January... $651,300 2. Total prime cost incurred in January... $651,300 Applied manufacturing (70% $390,000)... 273,000 Total manufacturing cost for January... $924,300

EXERCISE 3-24 (CONTINUED) 3. Total manufacturing cost for January... $ 924,300 Add: Work-in-process inventory, January 1... 305,500 Subtotal... $1,229,800 Deduct: Work-in-process inventory, January 31... 326,300 Cost of goods manufactured... $ 903,500 4. Finished-goods inventory, January 1... $ 162,500 Add: Cost of goods manufactured... 903,500 Cost of goods available for sale... $1,066,000 Deduct: Finished-goods inventory, January 31... 152,100 Cost of goods sold... $ 913,900 Since the company accumulates overapplied or underapplied until the end of the year, no adjustment is made to cost of goods sold until December 31. 5. Applied manufacturing for January... $273,000 Actual manufacturing incurred in January... 227,500 Overapplied as of January 31... $ 45,500 The balance in the Manufacturing Overhead account on January 31 is a $45,500 credit balance. NOTE: Actual selling and administrative expense, although given in the exercise, is irrelevant to the solution. EXERCISE 3-26 (15 MINUTES) 1. Applied manufacturing = total manufacturing costs 30% = $1,250,000 30% = $375,000 Applied manufacturing = direct-labor cost 80% Direct-labor cost = applied manufacturing 80% = $375,000.8 = $468,750 2. Direct-material used = total manufacturing cost

direct labor cost applied manufacturing = $1,250,000 $468,750 $375,000 = $406,250 3. Let X denote work-in-process inventory on December 31. Total work-in-process work-in-process cost of manufacturing + inventory, inventory, = goods cost Jan. 1 Dec. 31 manufactured $1,250,000 +.75X X = $1,212,500 Work-in-process inventory on December 31 amounted to $150,000. EXERCISE 3-28 (15 MINUTES).25X = $1,250,000 $1,212,500 X = $150,000 1. (a) At 100,000 chicken volume: (b) At 200,000 chicken volume: (c) At 300,000 chicken volume:

2. The predetermined rate does not change in proportion to the change in production volume. As production volume increases, the $150,000 of fixed is allocated across a larger activity base. When volume rises by 100%, from 100,000 to 200,000 chickens, the decline in the rate is 45.45% [($1.65 $.90)/$1.65]. When volume rises by 50%, from 200,000 to 300,000 chickens, the decline in the rate is 27.78% [($.90 $.65)/$.90]. EXERCISE 3-30 (20 MINUTES) 1. Raw-Material Inventory Work-in-Process Inventory 295,100 23,400 226,200 226,200 68,900 421,200 234,000 Wages Payable 156,000 421,200 748,800 Manufacturing Overhead Finished-Goods Inventory 234,000 39,000 156,000 Sales Revenue 171,600 253,500 23,400 Accounts Receivable Cost of Goods Sold 253,500 171,600 2. JAY SPORTS EQUIPMENT COMPANY, INC. PARTIAL BALANCE SHEET AS OF DECEMBER 31, 20X2 Current assets Cash... XXX Accounts receivable... XXX Inventory Raw material... $ 68,900 Work in process... 748,800 Finished goods... 23,400 JAY SPORTS EQUIPMENT COMPANY, INC. PARTIAL INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 20X2 Sales revenue... $253,500

Less: Cost of goods sold... 171,600 Gross margin... $ 81,900 EXERCISE 3-38 (15 MINUTES) Work-in-Process Inventory: Tanning Department... 11,000 a Manufacturing Overhead... 11,000 a 11,000 = 25 sets x 110 sq. ft. x $4 per sq. ft. Work-in-Process Inventory: Assembly Department... 1,100 b Manufacturing Overhead... 1,100 b $1,100 = 25 sets x 4 MH x $11 per MH Work-in-Process Inventory: Saddle Department... 5,625 c Manufacturing Overhead... 5,625 c $5,625 = 25 sets x 45 DLH x $5 per DLH EXERCISE 3-31 (20 MINUTES) 1. Raw material: Beginning inventory... $142,000 Add: Purchases...? Deduct: Raw material used... 652,000 Ending inventory... $162,000 Therefore, purchases for the year were... $672,000 2. Direct labor: Total manufacturing cost... $1,372,000 Deduct: Direct material... 652,000 Direct labor and manufacturing... $ 720,000 Direct labor + manufacturing = $720,000 Direct labor + (60%) (direct labor) = $720,000 (160%) (direct labor) = $720,000 Direct labor = $720,000 1.6

Direct labor = $450,000 3. Cost of goods manufactured: Work in process, beginning inventory... $ 160,000 Add: Total manufacturing costs... 1,372,000 Deduct: Cost of goods manufactured...? Work in process, ending inventory... $ 60,000 Therefore, cost of goods manufactured was... $1,472,000 EXERCISE 3-31 (CONTINUED) 4. Cost of goods sold: Finished goods, beginning inventory... $ 180,000 Add: Cost of goods manufactured... 1,472,000 Deduct: Cost of goods sold...? Finished goods, ending inventory... $ 220,000 Therefore, cost of goods sold was... $1,432,000 EXERCISE 3-33 (20 MINUTES) NOTE: Budgeted sales revenue, although given in the exercise, is irrelevant to the solution. 1. Predetermined rate = (a) = $32.50 per machine hour (b) = $26.00 per direct-labor hour (c) = $2.00 per direct-labor dollar or 200% of direct-labor cost *Budgeted direct-labor cost = 25,000 $13

2. Actual manufacturing applied manufacturing = overapplied or underapplied (a) $690,000 (22,000)($32.50) = $25,000 overapplied (b) $690,000 (26,000)($26.00) = $14,000 underapplied (c) $690,000 ($364,000 )(200%) = $38,000 overapplied Actual direct-labor cost = 26,000 $14 PROBLEM 3-45 (25 MINUTES) The completed T-accounts are shown below. (Missing amounts in problem are italicized.) Raw-Material Inventory Accounts Payable Bal. 1/1 29,400 3,500 Bal. 1/1 189,000 168,000 191,100 189,000 Bal. 12/31 50,400 1,400 Bal. 12/31 Work-in-Process Inventory Finished-Goods Inventory Bal. 1/1 23,800 Bal. 1/1 16,800 Direct 168,000 1,005,200 994,000 material Bal. 12/31 28,000 Direct 210,000 1,005,200 labor Mfg. 630,000 Bal. 12/31 26,600 Cost of Goods Sold 994,000 Manufacturing Overhead 633,500 630,000 Sales Revenue 1,134,000 Wages Payable 2,800 Bal. 1/1 Accounts Receivable 205,800 210,000 Bal. 1/1 15,400 7,000 Bal. 12/31 1,134,000 1,128,400 Bal. 12/31 21,000

2026 © DocPlayer.net Privacy Policy | Terms of Service | Feedback  | Do Not Sell My Personal Information