OSTING Donna Corporation manufactures custom cabinets for kitchens. It uses a no

Question

OSTING Donna Corporation manufactures custom cabinets for kitchens. It uses a norma 4-3costing system with two direct-cost categories-direct materials and direct manufao- turing labor-and one indirect-cost pool, manufacturing overhead costs. It provides the following information about manufacturing overhead costs for April 2017. Actual direct materials used Actual direct manufacturing labor costs paid in cash Indirect materials used Supervision and engineering salaries paid in cash Plant utilities and repairs paid in cash Plant depreciation Actual direct manufacturing labor-hours Cost of individual jobs completed and transferred to finished goods Cost of goods sold $60,000 54,000 $3,000 $50,000 10,000 $16,000 2,700 $180,000 $175,000 The following information is also available for 2017: $960,000 Budgeted manufacturing overhead costs for 2017 Direct manufacturing labor-hours for 2017 32,000 hours Present journal entries for (a) usage of direct and indirect materials, (b) manufacturing labor incurred, (c) manufacturing overhead costs incurred, (d) allocation of manufactur- ing overhead costs to jobs, (e) cost of jobs completed and transferred to finished goods, and (f) cost of goods sold. Subsidiary Ledgers Exhibits 4-8 and 4-9 present subsidiary ledgers that contain the underlying details the worm's-eye view" that help Robinson's managers keep track of the WPP 298 job, as on posed to the "bird's-eye view" of the general ledger. The sum of all entries in underlying sub idiary ledgers equals the total amount in the corresponding general ledger control accounts. Materials Records by Type of Material

Explanation / Answer

(A) Direct material (inventory) a/c Dr 60000

Indirect material (inventory) a/c Dr 3000

To Account Pahable a/c 63000

(Being material used for production )

(B) manufacturing labour a/c dr 54000

Outstanding a/c dr 10000

To cash a/c 54000

To account payable a/c 10000

(Being manufacturing labour incured along with outstanding fpr 5000 hours)

(C) manufacturing overhead cost a/c dr 76000

To cash a/c 60000

To depreciation a/c 16000

(Being manufacturing expenses incurred and paid partially in cadh and depreciation expenses transfered drom machinery account)

(D) finished work a/c dr 180000

Cost of goods sold a/c dr 175000

To overhead cost pool a/c 355000

(Being cost of manufacturing allocation expenses transfered)

(E) finished goods a/c dr 180000

To inventory a/c 180000

(Being goods ready for sale)

(F) cost of goods sold dr 175000

To account receivable a/c 175000

(Being account receivable generated)

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