
Concept explainers
Sultan, Inc. manufactures goods to special order and uses a
Required:
- 1. Prepare a schedule reflecting the cost of each of the four jobs.
- 2. Prepare
journal entries to record the transactions. - 3. Compute the ending balance in Work in Process.
- 4. Compute the ending balance in Finished Goods.
1.

Prepare a schedule that reflects the cost of all four jobs.
Explanation of Solution
Prepare a schedule that reflects the cost of all four jobs.
Particulars |
Job 101 ($) | Job 102 ($) | Job 103 ($) |
Job 104 ($) |
Total Cost ($) |
Direct Materials | 2,200 | 5,700 | 7,100 | 1,700 | 16,700 |
Direct Labor | 2,700 | 6,800 | 9,200 | 2,100 | 20,800 |
Factory Overhead | 1,200 | 2,000 | 3,800 | 1,000 | 8,000 |
Total | 6,100 | 14,500 | 20,100 | 4,800 | 45,500 |
Table (1)
2.

Provide journal entry to record the given transactions.
Explanation of Solution
Provide journal entry to record the given transactions.
Date | Accounts title and explanation | Debit ($) | Credit ($) |
a | Materials | 37,000 | |
Accounts payable | 37,000 | ||
(To record materials purchased on account) | |||
b | Work in Process | 16,700 | |
Factory overhead | 1,350 | ||
Materials | 18,050 | ||
(To record issue of direct materials and indirect materials) | |||
c | Payroll | 23,050 | |
Wages Payable | 23,050 | ||
(To record factory wages and salaries) | |||
d | Work in Process | 20,800 | |
Factory overhead | 2,250 | ||
Payroll | 23,050 | ||
(To record payment of wages to the labor) | |||
e | Factory overhead | 2,400 | |
Accounts payable | 2,400 | ||
(To record factory overhead costs on account) | |||
f. | Factory overhead | 2,000 | |
Accumulated Depreciation - Machinery | 2,000 | ||
(To record depreciation on factory machine) | |||
g. | Work in Process | 8,000 | |
Factory Overhead | 8,000 | ||
(To record transfer of factory overhead to Work-in process) | |||
h. | Finished Goods (1) | 40,700 | |
Work in Process | 40,700 | ||
(To record the transfer of cost of completed work to finished goods) | |||
i | Accounts receivable | 39,000 | |
Sales | 39,000 | ||
(To record the sale made on account) | |||
Cost of goods sold (2) | 20,600 | ||
Finished goods | 20,600 | ||
(To record the cost of goods sold) |
Table (2)
Working note 1: Calculate the cost of completed work (finished goods).
Working note 2: Calculate the cost of goods sold.
3.

Calculate the ending balance in work-in process.
Explanation of Solution
Calculate the ending balance in work-in process.
Hence, the ending balance in work-in process is $4,800.
4.

Calculate the ending balance in finished goods.
Explanation of Solution
Calculate the ending balance in finished goods.
Hence, the ending balance in finished goods is $20,100.
Want to see more full solutions like this?
Chapter 1 Solutions
Principles of Cost Accounting
- Compute the depreciation chargearrow_forwardFor its inspecting cost pool, Brilliant Professor Mullen Company expected an overhead cost of $360,000 and an estimated 14,200 inspections. The actual overhead cost for that cost pool was $395,000 for 16,000 actual inspections. The activity-based overhead rate (ABOR) used to assign the costs of the inspecting cost pool to products is __.arrow_forwardCan you help me with accounting questionsarrow_forward
- Principles of Cost AccountingAccountingISBN:9781305087408Author:Edward J. Vanderbeck, Maria R. MitchellPublisher:Cengage LearningExcel Applications for Accounting PrinciplesAccountingISBN:9781111581565Author:Gaylord N. SmithPublisher:Cengage LearningManagerial AccountingAccountingISBN:9781337912020Author:Carl Warren, Ph.d. Cma William B. TaylerPublisher:South-Western College Pub
- Managerial Accounting: The Cornerstone of Busines...AccountingISBN:9781337115773Author:Maryanne M. Mowen, Don R. Hansen, Dan L. HeitgerPublisher:Cengage LearningCornerstones of Cost Management (Cornerstones Ser...AccountingISBN:9781305970663Author:Don R. Hansen, Maryanne M. MowenPublisher:Cengage LearningPrinciples of Accounting Volume 2AccountingISBN:9781947172609Author:OpenStaxPublisher:OpenStax College




