FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Transcribed Image Text:The correct answer is: $121,550
The following activities took place in the WIP inventory during February:
WIP Inventory A/C
$15,000 To Finished Goods
Feb 1 Bal
Direct Materials Used
120,000
Direct Labour Incurred
?
Manufacturing
Overhead
?
Applied
Additional information:
Indirect material issued to production was: $20,000
Manufacturing Labour Costs
incurred..
Manufacturing Overhead Rate...
Actual Manufacturing Overhead Costs for
Feb............
$162,500 (75% represents direct
labour)
120% of direct labour cost
$130,000
Two jobs were completed with total costs of $120,000 & $85,000 respectively. They were
sold on account
at a mark-up of 50% on cost.
The journal entry to show sale revenue earned from the two completed jobs:
Select one:
a. DR Accounts Receivable $410,000 and CR Sales Revenue $410,000✔
b. DR Accounts Receivable $205,000 and CR Sales Revenue $205,000
C. DR Sales Revenue $205,000 and CR Accounts Receivable $205,000
d. DR Sales Revenue $410,000 and CR Accounts Receivable $410,000
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