How to solve the T-accounts and Statements and blanks You work for Thunderduck C

Question

How to solve the T-accounts and Statements and blanks

You work for Thunderduck Custom Tables Inc. This is the first month of operations. The company designs and manufactures specialty tables. Each table is specially customized for the customer. This month, you have been asked to develop and manufacture two new tables for customers. You will design and build the tables. This is a no nail, no screw, and no glue manufacturing ( no indirect materials used). You will be keeping track of the costs incurred to manufacture the tables using Job #1 Cost Sheet and Job #2 Cost Sheet. Step1 The cost of the direct materials that can be used to manufacture the table are as follows. These cost are on a per unit basis. Table Top Table Leg Drawer $1,000.00 $150.00 $300.00 The company uses a job order costing system and applies manufacturing overhead to jobs based on direct labor hours. The company estimates that there will be 12 direct labor hours worked during the month. The estimated manufacturing overhea cost for the month is: a. Factory supervisor salary per month b. Rent for the factory per month c. Depreciation of factory equipment per montlh $ 2,500.00 $500.00 $600.00 $ 3,600.00 Total Estimated manufacturing overhead What is the predetermined manufacturing overhead rate? Step 2 Step 3 The first order you received was to manufacture a table using a table top and four legs. This is your Job #1 The customer that has ordered Job #2, wants a table that is the same as Job #1, but wants to also add a drawer to the table

Explanation / Answer

Predetermined manufacturing overhead rate = $ 3,600 / 12 = $ 300 per direct labor hour.

5. Sales:

Accounts Receivable:

Raw Materials:

Work in Process

Finished Goods

Manufacturing Overhead

6. Schedule of Cost of Goods Manufactured:

Schedule of Cost of Goods Sold:

Salaries and Wages Payable:

7. Income Statement

For the month ended December 31

8. Ending balance for raw materials : $ 6,500

Ending balance for work in process: $ 2,860

Ending balance for finished goods: Nil

Actual manufacturing overhead incurred during December : $ 3,650

Total applied manufacturing overhead during December : $ 2,700

Unadjusted cost of goods sold : $ 3,520

Manufacturing overhead was underapplied.

Manufacturing overhead was underapplied by $ 950.

Adjusted cost of goods sold : $ 4,470

Gross Margin : $ 10,530.

Total prime cost for Job # 1 : $ 1,720

Conversion cost for Job # 1 : $ 1,920

Product cost for Job # 1 : $ 3,520

Period costs for December : $ 3,800

Total variable costs for Job # 1 : $ 1,720

Contribution margin for Job # 1 : $ 13,280

Actual fixed manufacturing costs that would have been incurred if five tables were manufactured : $ 3,650.

Accounts Receivable 15,000 Income Summary 15,000

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