Entries for factory costs and jobs completed Instructions Chart of Accounts Jour

Question

Entries for factory costs and jobs completed Instructions Chart of Accounts Journal Instructions Old School Publishing Inc. began printing operations on January 1. Jobs 301 and 302 were completed during the month, and all costs applicable to them were recorded on the related cost sheets. Jobs 303 and 304 are still in process at the end of the month, and all applicable costs except factory overhead have been recorded on the related cost sheets. In addition to the materials and labor charged directly to the jobs, $8,000 of indirect materials and $12,400 of indirect labor were used during the month. The cost sheets for the four jobs entering production during the month are as follows, in summary form: Job 301 Direct materials $10,000 Direct labor 8,000 Factory overhead 6,000 $24,000 Total Job 302 Direct materials $20,000 Direct labor7000 Factory overhead 12,750 Total $49,750

Explanation / Answer

job 301 job 302 job 303 job 304 total Direct materials 10,000 20,000 24,000 14,000 68,000 direct labor 8,000 17,000 18,000 12,000 55,000 factory overhead 6,000 12750 13500 9000 41,250 total 24,000 49,750 55,500 35,000 164,250 overhead rate = 6000/8000 0.75 75% journal Entries Accounting titles & Explanations Debit Credit a) Work in process inventory 68,000 Factory overhead 8,000 Raw materials inventory 76,000 b) Work in process inventory 55,000 Factory overhead 12,400 Factory wages payable 67,400 c) Work in process inventory 41,250 Factory overhead 41,250 d) Finished goods inventory 73,750 work in process inventory 73,750

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