Manor Painting is a commercial interior and exterior painting contractor specializing in commercial buildings. An inventory of material and equipment is on hand at all times, so work can start as quickly as possible. Special equipment is ordered as required. On August the Materials Inventory account had a balance of $54,000. The Work-in-Process Inventory account is maintained to record costs of work not yet complete. There were two such jobs on August 1 with the following costs: Materials and equipment Direct labor Overhead (applied) Job 84 $ 23,100 20,300 8,120 Job 87 $ 78,800 39,400 15,760 Overhead has been applied at 40 percent of the costs of direct labor using an annual rate. During August, Manor Painting started two new jobs. Additional work was carried out on Jobs 84 and 87. Job 87 was completed and billed to the customer. Details on the costs incurred on jobs during August follow: Materials and equipment Direct labor (wages payable) Job 84 $ 4,500 7,800 Job 87 $ 7,200 10,100 Job 88 $ 6,900 Job 90 $ 4,400 8,900 2,400 Other August Events 1. Purchased materials and equipment for $14,100. 2. Billed $195,000 to the customer for Job 87 and received payment for $115,000 of that amount. 3. Received $18,600 payment on Job 82 delivered to customer in July. 4. Determined that payroll for indirect labor personnel totaled $2,100. 5. Issued supplies and incidental materials for current jobs costing $750. 6. Recorded overhead and advertising costs for the operation as follows (all cash except equipment depreciation): Property taxes Storage area rental Truck and delivery cost Advertising and promotion campaign Inspections Telephone and other miscellaneous Equipment depreciation Required: $ 900 1,050 1,630 1,200 900 680 2,720 a. Prepare journal entries to record the flow of costs for operations during August. b. Calculate the amount of over- or underapplied overhead for the month. This amount is debited or credited to Cost of Goods Sold. c. Determine inventory balances for Materials and Equipment Inventory and Work-in-Process Inventory. Complete this question by entering your answers in the tabs below. Required A Required B Required C Determine inventory balances for Materials and Equipment Inventory and Work-in-Process Inventory. Materials and equipment inventory Work-in-process inventory < Required B Required C >

Manor Painting is a commercial interior and exterior painting contractor specializing in commercial buildings. An inventory of material and equipment is on hand at all times, so work can start as quickly as possible. Special equipment is ordered as required. On August the Materials Inventory account had a balance of $54,000. The Work-in-Process Inventory account is maintained to record costs of work not yet complete. There were two such jobs on August 1 with the following costs: Materials and equipment Direct labor Overhead (applied) Job 84 $ 23,100 20,300 8,120 Job 87 $ 78,800 39,400 15,760 Overhead has been applied at 40 percent of the costs of direct labor using an annual rate. During August, Manor Painting started two new jobs. Additional work was carried out on Jobs 84 and 87. Job 87 was completed and billed to the customer. Details on the costs incurred on jobs during August follow: Materials and equipment Direct labor (wages payable) Job 84 $ 4,500 7,800 Job 87 $ 7,200 10,100 Job 88 $ 6,900 Job 90 $ 4,400 8,900 2,400 Other August Events 1. Purchased materials and equipment for $14,100. 2. Billed $195,000 to the customer for Job 87 and received payment for $115,000 of that amount. 3. Received $18,600 payment on Job 82 delivered to customer in July. 4. Determined that payroll for indirect labor personnel totaled $2,100. 5. Issued supplies and incidental materials for current jobs costing $750. 6. Recorded overhead and advertising costs for the operation as follows (all cash except equipment depreciation): Property taxes Storage area rental Truck and delivery cost Advertising and promotion campaign Inspections Telephone and other miscellaneous Equipment depreciation Required: $ 900 1,050 1,630 1,200 900 680 2,720 a. Prepare journal entries to record the flow of costs for operations during August. b. Calculate the amount of over- or underapplied overhead for the month. This amount is debited or credited to Cost of Goods Sold. c. Determine inventory balances for Materials and Equipment Inventory and Work-in-Process Inventory. Complete this question by entering your answers in the tabs below. Required A Required B Required C Determine inventory balances for Materials and Equipment Inventory and Work-in-Process Inventory. Materials and equipment inventory Work-in-process inventory < Required B Required C >

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter1: Introduction To Cost Accounting

Section: Chapter Questions

Problem 12E: Gerken Fabrication Inc. uses the job order cost system of accounting. The following information was...

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