Edit View History ezto.mheducation.com 2 Ha Mariya Company uses a job-order cost

Question

Edit View History ezto.mheducation.com 2 Ha Mariya Company uses a job-order costing system and applies manufacturing overhead cost to jobs on the basis of the cost of direct materials used in production. Its predetermined overhead rate was based on a os formula that estimated $233,450 of manufacturing overhoad for an estimated allocation base of $161,000 direct material dollars The following transactions took place during the yoar (all purchases and services were acquired on account): a. Raw materials purchased, $148,000. b. Raw materials requisitioned for use in production (all direct materials), $144,000 c. Utility bills incurred in the factory, $27,000. d. Costs for salaries and wages were incurred as follows Direct labor Indirect labor Selling and administrative salaries $229,000 S 63,200 $146,000 e. Maintenance costs incurred in the factory, $18,500 . Advertising costs incurred, $131,000. g. Depreciation recorded for the year, $46,000 (70% relates to factory assets, and the remainder relates to selling and administrative assets). occupied by sales and administration) Manufacturing overhead cost was applied to jobs, h. Rental oost incurred on buldings, $88,000 (80% of the space is occupied by the factory, and 20% is L Miscellaneous selling and administrative costs incurred, $12,500. L. Sales for the year (ail on account) totaled S1,130,000. These goods cost $545,000 according to their job The balances in the inventory accounts at the beginning of the year were as follows: Cost of goods manufactured for the year, $570,000. cost sheets Raw materials Work in process Finished Goods $ 26,000 $ 27,000 37,000 Required: Prepare journal entries to record the above transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account fiold.) View transaction list MacBook Air

Explanation / Answer

1) General Journal Debit Credit a. Raw material $148,000 Accounts payable $148,000 To record purchase of direct materials b. Work in process $144,000 Raw Materials $144,000 To record materials requisitions c. Manufacturing overhead $27,000 Accounts payable $27,000 To record factory utilities d. Work in process $229,000 Manufacturing overhead $63,200 Selling and administrative $146,000 Salaries and wages payable $438,200 To record payroll e. Manufacturing overhead $18,500 Accounts payable $18,500 To record factory maintenance f. Advertising expense $131,000 Accounts payable $131,000 To record advertising expense incurred g. Manufacturing overhead ($46,000 x 70%) $32,200 Depreciation expense ($46000 x 30%) $138,000 Accumulated depreciation $46,000 To record depreciation h. Manufacturing overhead ($88,000 x 80%) $70,400 Rent expense ($88000 x 20%) $17,600 Accounts payable $88,000 To record cost of rent i. Miscellaneous expense $12,500 Accounts payable $12,500 To record misc. selling & administrative expense j. Work in process $148,000 + $229,000 $377,000 Manufacturing overhead $377,000 To record the application of MOH k. Finished goods $570,000 Work in process $570,000 To record completed goods transferred to finished Goods l Accounts receivable $1,130,000 Sales $1,130,000 To record sales on account Cost of goods sold $545,000 Finished goods $545,000 To record cost of goods sold

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