Problem 20-1A Job No. Direct Materials Direct Labor LINK TO TEXT LINK TO TEXT LI
ID: 2513337 • Letter: P
Question
Problem 20-1A
Job No.
Direct Materials
Direct Labor
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Job No. 50
Date
Direct Materials
Direct Labor
Manufacturing Overhead
Job No. 51
Date
Direct Materials
Direct Labor
Manufacturing Overhead
Job No. 52
Date
Direct Materials
Direct Labor
Manufacturing Overhead
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No.
Account Titles and Explanation
Debit
Credit
(1)
(2)
(3)
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No.
Account Titles and Explanation
Debit
Credit
(1)
(2)
(3)
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Account Titles and Explanation
Debit
Credit
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No.
Account Titles and Explanation
Debit
Credit
(1)
(2)
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Problem 20-1A
Lott Company uses a job order cost system and applies overhead to production on the basis of direct labor costs. On January 1, 2017, Job No. 50 was the only job in process. The costs incurred prior to January 1 on this job were as follows: direct materials $21,200, direct labor $12,720, and manufacturing overhead $16,960. As of January 1, Job No. 49 had been completed at a cost of $95,400 and was part of finished goods inventory. There was a $15,900 balance in the Raw Materials Inventory account.During the month of January, Lott Company began production on Jobs 51 and 52, and completed Jobs 50 and 51. Jobs 49 and 50 were also sold on account during the month for $129,320 and $167,480, respectively. The following additional events occurred during the month.
1. Purchased additional raw materials of $95,400 on account. 2. Incurred factory labor costs of $74,200. Of this amount $16,960 related to employer payroll taxes. 3. Incurred manufacturing overhead costs as follows: indirect materials $18,020; indirect labor $21,200; depreciation expense on equipment $12,720; and various other manufacturing overhead costs on account $16,960. 4. Assigned direct materials and direct labor to jobs as follows.
Job No.
Direct Materials
Direct Labor
50 $10,600 $5,300 51 41,340 26,500 52 31,800 21,200Explanation / Answer
predetermined overhead rate Estimated manufacturing overhead/total estimated direct labor costs 890400/742000 120.00% job no 50 Date Direct direct MOH materials labor beg. 21,200 12,720 16,960 Jan 10,600 5,300 6,360 31,800 18,020 23,320 cost of completed job Direct materials 31,800 direct labor 18,020 MOH 23,320 total cost 73,140 job no 51 Date Direct direct MOH materials labor Jan 41,340 26,500 31,800 41,340 26,500 31,800 cost of completed job Direct materials 41,340 direct labor 26,500 MOH 31800 total cost 99,640 Job 52 Date Direct direct MOH materials labor Jan 31,800 21,200 25,440 No Account titles & Explanations Debit Credit 1) Raw materials inventory 95,400 Accounts payable 95,400 2) Factory labor 74,200 Factory wages payable 57,240 employer payroll taxes payable 16,960 3) manufacturing overhead 68,900 raw materials inventory 18,020 Factory labor 21,200 Accumulated depreciation 12,720 Accounts payable 16,960 No Account titles & Explanations Debit Credit 1) Work in process inventory 83,740 Raw materials inventory 83,740 2) work in process inventory 53,000 Factory labor 53,000 3) Work in process inventory 63600 manufacturing overhead 63,600 Account titles & Explanations Debit Credit finished goods inventory 172,780 work in process inventory 172,780 (job 50 +job 51 = No Account titles & Explanations Debit Credit Accounts receivable 296800 sales 296,600 cost of goods sold finished goods inventory 168,540 (job 49+job 50) 168,540 finished goods inventory 99,640 Job No 51 finished goods inventory opening 95,400 COGS 168,540 WIP 172,780 end bal 99,640 manufacturing overhead 5,300 under applied manufacturing overhead Actual 68,900 Applied 63,600 bal 5,300
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