Auto-Motion is a lean manufacturer of self-driving wheelchairs. The company budgets $646,000 of conversion costs and 1,700 production hours for this year. The manufacturing of each wheelchair requires 25 production hours and raw materials costs of $4,360. The company started and completed 86 wheelchairs during the year and sold 70. Each wheelchair is sold for $15,600. Actual conversion costs equal applied conversion costs. Required: 1. Prepare journal entries to record (a) the purchase of raw materials on credit to produce 86 units, (b) applied conversion costs to the production of 86 units, (c) actual conversion costs of $817,000 (credit "Various Accounts"), (d) sale of 70 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 Prepare journal entries to record (a) the purchase of raw materials on credit to produce 86 units, (b) applied conversion costs to the production of 86 units, (c) actual conversion costs of $817,000 (credit "Various Accounts"), (d) sale of 70 units on credit, and (e) ending inventory and cost of goods sold. View transaction list View journal entry worksheet Required 1 Required 2 Prepare journal entries to record (a) the purchase of raw materials on credit to produce 86 units, (b) applied conversion costs to production of 86 units, (c) actual conversion costs of $817,000 (credit "Various Accounts"), (d) sale of 70 units on credit, and (e) inventory and cost of goods sold. View transaction list View journal entry worksheet No Transaction General Journal 1 a. Work in process inventory Accounts payable 2 b. Work in process inventory Conversion costs 3 C. Conversion costs Various accounts 4 LO 5 d. Accounts receivable Sales Debit Credit 374,960 374,960 817,000 817,000 817,000 817,000 1,092,000 1,092,000 e. Cost of goods sold 970,200 Finished goods inventory X

Jean and Tom Perritz own and manage Happy Home Helpers, Inc. (HHH), a house-cleaning service. Each cleaning (cleaning one house one time) takes a team of three house cleaners about 1.5 hours. On average, HHH completes about 15,000 cleanings per year. The following total costs are associated with the total cleanings: Next year, HHH expects to purchase 25,600 of direct materials. Projected beginning and ending inventories for direct materials are as follows: There is no work-in-process inventory and no finished goods inventory; in other words, a cleaning is started and completed on the same day. HHH expects to sell 15,000 cleanings at a price of 45 each next year. Total selling expense is projected at 22,000, and total administrative expense is projected at 53,000. Required: 1. Prepare an income statement in good form. 2. What if Jean and Tom increased the price to 50 per cleaning and no other information was affected? Explain which line items in the income statement would be affected and how.

Jean and Tom Perritz own and manage Happy Home Helpers. Inc. (HHH), a house-cleaning service. Each cleaning (cleaning one house one time) takes a team of three house cleaners about 1.5 hours. On average, HHH completes about 15,000 cleanings per year. The following total costs are associated with the total cleanings: Next year, HHH expects to purchase 25,600 of direct materials. Projected beginning and ending inventories for direct materials are as follows: There is no work-in-process inventory and no finished goods inventory; in other words, a cleaning is started and completed on the same day. Required: 1. Prepare a statement of cost of services sold in good form. 2. How does this cost of services sold statement differ from the cost of goods sold statement for a manufacturing firm?

Box Springs, Inc., makes two sizes of box springs: twin and double. The direct material for the twin is $25 per unit and $40 s used in direct labor, while the direct material for the double is $40 per unit, and the labor cost is $50 per unit. Box Springs estimates it will make 5,000 twins and 9,000 doubles in the next year. It estimates the overhead for each cost pool and cost driver activities as follows: How much does each unit cost to manufacture?