Auto-Motion is a lean manufacturer of self-driving wheelchairs. The company budgets $560,000 of conversion costs and 2,000 production hours for this year. The manufacturing of each wheelchair requires 30 production hours and raw materials costs of $4,480 The company started and completed 98 wheelchairs during the year and sold 85. Each wheelchair is sold for $17,000. Actual conversion costs equal applied conversion costs. Required: 1. Prepare journal entries to record (a) the purchase of raw materials on credit to produce 98 units, (b) applied conversion costs to the production of 98 units. (d) actual conversion costs of $823,200 (credit "Various Accounts"). (d) sale of 85 units on credit, and (e) ending inventory and cost of goods sold 2. Compute the ending balances of Work in Process Inventory and Finished Goods Inventory. Assume each of these inventory accounts began the year with a balance of zero Complete this question by entering your answers in the tabs below. Required 1 Required 2 Compute the ending balances of Work in Process Inventory and Finished Goods Inventory. Assume each of these inventory accounts began the year with a balance of zero. Ending Balances Work in process inventory Finished goods inventory 167,440
Auto-Motion is a lean manufacturer of self-driving wheelchairs. The company budgets $560,000 of conversion costs and 2,000 production hours for this year. The manufacturing of each wheelchair requires 30 production hours and raw materials costs of $4,480 The company started and completed 98 wheelchairs during the year and sold 85. Each wheelchair is sold for $17,000. Actual conversion costs equal applied conversion costs. Required: 1. Prepare journal entries to record (a) the purchase of raw materials on credit to produce 98 units, (b) applied conversion costs to the production of 98 units. (d) actual conversion costs of $823,200 (credit "Various Accounts"). (d) sale of 85 units on credit, and (e) ending inventory and cost of goods sold 2. Compute the ending balances of Work in Process Inventory and Finished Goods Inventory. Assume each of these inventory accounts began the year with a balance of zero Complete this question by entering your answers in the tabs below. Required 1 Required 2 Compute the ending balances of Work in Process Inventory and Finished Goods Inventory. Assume each of these inventory accounts began the year with a balance of zero. Ending Balances Work in process inventory Finished goods inventory 167,440
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Auto-Motion is a lean manufacturer of self-driving wheelchairs. The company budgets $560,000 of conversion costs and 2,000
production hours for this year. The manufacturing of each wheelchair requires 30 production hours and raw materials costs of $4,480
The company started and completed 98 wheelchairs during the year and sold 85. Each wheelchair is sold for $17,000. Actual
conversion costs equal applied conversion costs.
Required:
1. Prepare journal entries to record (a) the purchase of raw materials on credit to produce 98 units, (b) applied conversion costs to the
production of 98 units, (d) actual conversion costs of $823,200 (credit "Various Accounts"), (d) sale of 85 units on credit, and (e) ending
inventory and cost of goods sold.
2. Compute the ending balances of Work in Process Inventory and Finished Goods Inventory. Assume each of these inventory
accounts began the year with a balance of zero
Complete this question by entering your answers in the tabs below.
Required 1 Required 2
Compute the ending balances of Work in Process Inventory and Finished Goods Inventory. Assume each of these inventory
accounts began the year with a balance of zero.
Ending Balances
Work in process inventory
Finished goods inventory
$ 167,440
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