Question

Waterway Fabricators produces protective covers for smart phones. Since the covers must be customized to each smart phone model, Waterway uses a job order costing system. On September 1, the company reported the following inventory balances:

Direct Materials - $29,300
Work in Process - $151,000
Finished Goods - $257,000

During September, the following events occurred:
1. Waterway purchased direct materials costing $1,041,000 on account.
2. Waterway used $427,000 in direct materials in production.
3. Waterway’s employees clocked 24,000 direct labor hours at an average wage rate of $13.01 per direct labor hour.
4. The company incurred $179,000 in manufacturing overhead, including $26,000 in indirect labor costs.
5. Using direct labor hours as the application base, the company applied $164,000 of manufacturing overhead to jobs worked on in September.
6. The company completed production on jobs costing $855,000.
7. The company delivered jobs costing $1,075,000 to customers.

Calculate the ending September balance of the Direct Materials, Work in Process, and Finished Goods Inventory accounts.
Ending September Balance
Direct Materials $_______.
Work in Process $_______.
Finished Goods $________.

Answer 1

Materials Ending Inventory $ 29,914

Ending Work In Process 214420

Closing Finished Goods $ 37,000

Step-by-step explanation:

Dr Cr

Direct Materials (opening Inventory) $29,300

Add Purchases $1,041,000

Less Ending Inventory $ 29,914

Direct Materials Used $427,000

Conversion Costs

Add Direct Labor $ 312240

Factory Over Head $ 179,000 $491240

Add Beginning Work In Process $151,000

Less Ending Work In Process 214420

Cost Of Goods Manufactured $855,000

Add opening Finished Goods $257,000

Cost of Goods Available for Sale $1112,000

Less Closing Finished Goods $ 37,000

Cost Of Goods Sold $1,075,000

Working

Costs incurred during the period

Direct Materials Used In Production $427,000

Direct Labor = 24000*$13.01= $ 312240

Manufacturing Overheads $ 179,000

Answer 2

Raw ending 643,300

ending WIP 199,240

ending FG 37,000

Step-by-step explanation:

Raw materials

beginning 29300

purchased 1041000

used in production (427000)

ending 643300

cost added (in between step to get ending WIP)

materials 427000

direct labor 312240 (24,000 DLH x $13.01)

overhead 164000

total 903240

Ending WIP

beginning WIP 151000

added 903240

COGM (855000)

ending WIP 199240

Finished goods

beginning FG 257000

COGM 855000

COGS (1075000)

ending FG 37000