Horngren's Cost Accounting: A Managerial Emphasis (16th Edition)
16th Edition
ISBN: 9780134475585
Author: Srikant M. Datar, Madhav V. Rajan
Publisher: PEARSON
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Textbook Question
Chapter 7, Problem 7.31E
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Required information
[The following information applies to the questions displayed below.]
Clopack Company manufactures one product that goes through one processing department called Mixing. All raw
materials are introduced at the start of work in the Mixing Department. The company uses the weighted-average method
of process costing. Its Work in Process T-account for the Mixing Department for June follows (all forthcoming questions
pertain to June):
June 1 balance
Materials
Direct labor
Overhead
June 30 balance
Debit
Work in Process-Mixing Department
View transaction list
Credit
27,000 Completed and transferred to
Finished Goods
151, 100
95,500
113,000
The June 1 work in process inventory consisted of 4,400 units with $14,100 in materials cost and $12,900 in conversion
cost. The June 1 work in process inventory was 100% complete with respect to materials and 60% complete with respect
to conversion. During June, 36,900 units were started into production. The June 30 work in processβ¦
For the accounting memo, you have to write THE CONCEPT of relevant cost. DON'T INCLUDE ANYTHING IRRELEVANT and PLEASE ANSWER THIS WITH 5 paragraphs.
Linzee Liners estimates that its manufacturing overhead will be $1,761,800 in Year 1. It further estimates that direct labor costs will
amount to $766,000. During March, Linzee worked on four jobs with actual direct labor costs of $36,600 for Job 0301, $24,100 for Job
0302, $33,600 for Job 0303, and $17,600 for Job 0304. Actual manufacturing overhead costs for the year were $1,750,000. Actual
direct labor costs for the year were $751,000. Manufacturing overhead is applied to jobs based on direct labor costs using
predetermined rates.
The amount of overhead applied in each of the inventory accounts at the end of Year 1 is as follows
Work-in-process inventory
Finished goods Inventory
Cost of goods sold
$ 34,546
$ 276,368
$ 1,416,386
Required:
Prepare an entry to allocate the over-or underapplied overhead.
Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.
View transaction list
Chapter 7 Solutions
Horngren's Cost Accounting: A Managerial Emphasis (16th Edition)
Ch. 7 - What is the relationship between management by...Ch. 7 - What are two possible sources of information a...Ch. 7 - Distinguish between a favorable variance and an...Ch. 7 - What is the key difference between a static budget...Ch. 7 - Why might managers find a flexible-budget analysis...Ch. 7 - Describe the steps in developing a flexible...Ch. 7 - List four reasons for using standard costs.Ch. 7 - How might a manager gain insight into the causes...Ch. 7 - List three causes of a favorable direct materials...Ch. 7 - Describe three reasons for an unfavorable direct...
Ch. 7 - How does variance analysis help in continuous...Ch. 7 - Why might an analyst examining variances in the...Ch. 7 - Prob. 7.13QCh. 7 - When inputs are substitutable, how can the direct...Ch. 7 - Benchmarking against other companies enables a...Ch. 7 - Metal Shelf Companys standard cost for raw...Ch. 7 - All of the following statements regarding...Ch. 7 - Amalgamated Manipulation Manufacturings (AMM)...Ch. 7 - Atlantic Company has a manufacturing facility in...Ch. 7 - Basix Inc. calculates direct manufacturing labor...Ch. 7 - Flexible budget. Sweeney Enterprises manufactures...Ch. 7 - Flexible budget. Bryant Companys budgeted prices...Ch. 7 - Flexible-budget preparation and analysis. Bank...Ch. 7 - Flexible budget, working backward. The Clarkson...Ch. 7 - Flexible-budget and sales volume variances....Ch. 7 - Price and efficiency variances. Sunshine Foods...Ch. 7 - Materials and manufacturing labor variances....Ch. 7 - Direct materials and direct manufacturing labor...Ch. 7 - Price and efficiency variances, journal entries....Ch. 7 - Materials and manufacturing labor variances,...Ch. 7 - Journal entries and T-accounts (continuation of...Ch. 7 - Price and efficiency variances, benchmarking....Ch. 7 - Static and flexible budgets, service sector....Ch. 7 - Flexible budget, direct materials, and direct...Ch. 7 - Variance analysis, nonmanufacturing setting. Joyce...Ch. 7 - Comprehensive variance analysis review. Ellis...Ch. 7 - Possible causes for price and efficiency...Ch. 7 - Material-cost variances, use of variances for...Ch. 7 - Direct manufacturing labor and direct materials...Ch. 7 - Direct materials efficiency, mix, and yield...Ch. 7 - Direct materials and manufacturing labor...Ch. 7 - Direct materials and manufacturing labor...Ch. 7 - Use of materials and manufacturing labor variances...Ch. 7 - Direct manufacturing labor variances: price,...Ch. 7 - Direct-cost and selling price variances. MicroDisk...Ch. 7 - Variances in the service sector. Derek Wilson...Ch. 7 - Prob. 7.47P
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- Post the appropriate entries to T accounts for Work in Process and Finished Goods, using the identifying letters as transaction codes. Determine the correct ending balance. The ending balance label is provided on the left side of the T account even when the ending balance is a credit. Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Work in Process b. 56,570 Β f. 39,200 e. 19,760 Β Β Bal. 37,130 Β ??? Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Β Finished Goods e. 39,200 Β g. 28,810 Bal. 10,390 Β ??? The T-Accounts are based on these journal entries. a. Materials 33,100 Β Β Accounts Payable Β 33,100 b. Work in Process 56,570 Β Β Factory Overhead 5,720 Β Β Materials Β 29,840 Β Wages Payable Β 32,450 c. Factory Overhead 6,470 Β Β Accounts Payable Β 6,470 d. Factory Overhead 1,790 Β Β Accumulated Depreciation Β 1,790 e. Work in Process 19,760 Β Β Factory Overheadβ¦arrow_forwardRequired information The Foundational 15 (Static) [LO4-1, LO4-2, LO4-3, LO4-4, LO4-5] [The following information applies to the questions displayed below.] Clopack Company manufactures one product that goes through one processing department called Mixing. All raw materials are introduced at the start of work in the Mixing Department. The company uses the weighted-average method of process costing. Its Work in Process T-account for the Mixing Department for June follows (all forthcoming questions pertain to June): Work in Process-Mixing Department 28,000 120,000 79,500 97,000 Completed and transferred to Finished Goods June 1 balance Materials Direct labor Overhead June 30 balance The June 1 work in process inventory consisted of 5,000 units with $16,000 in materials cost and $12,000 in conversion cost. The June 1 work in process inventory was 100% complete with respect to materials and 50% complete with respect to conversion. During June, 37,500 units were started into production. Theβ¦arrow_forwardFor the accounting memo, Just explain THE CONCEPT of relevant cost. DON'T INCLUDE ANYTHING IRRELEVANT and PLEASE ANSWER THIS WITH 4 paragraphs.arrow_forward
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- a. Prepare journal entries to record the transactions. b. Prepare T-accounts to show the flow of costs during the period from Materials Inventory through Cost of Goods sold.arrow_forwardWoodstock Binding has two service departments, IT (Information Technology) and HR (Human Resources), and two operating departments, Publishing and Binding. Management has decided to allocate IT costs on the basis of IT Tickets (issued with each IT request) in each department and HR costs on the basis of employees in each department. The following data appear in the company records for the current period: IT tickets Esployees Department direct costs a. The order of allocation starts with IT. b. The order of allocation starts with HR. Show Transcribed Text IT From: Service department costs IT 0 HR Total costs 16 $ 156,000 Required: Use the step method to allocate the service costs, using the following: $ HR 1,700 0 $ 266,200 Complete this question by entering your answers in the tabs below. Publishing 1,700 24 Required A Required B Use the step method to allocate the service costs, using the following: The order of allocation starts with IT. Note: Amounts to be deducted should beβ¦arrow_forwardprepare the journal entries and compute the due from to customers using cost recovery method or point in timearrow_forward
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