Question

The following information was taken from the job cost sheet for Job 101 for Scott Manufacturing Company: Date started: July 5 Date completed: August 21 Date Direct materials Direct labor Factory overhead Job Total July 5 $3,000 July 15 $900 $450 July 17 1,500 July 22 1,350 675 August 1 1,500 August 21 600 300 Job 101 was sold on account on August 25 for 160% of its cost. Required: A. Prepare the journal entries to record the costs incurred for Job 101 in the current year for (1) direct materials, (2) direct labor, and (3) factory overhead. 1. 2. 3. B. Prepare the journal entry to record the completion of Job 101. C. What is the predetermined factory overhead rate for Scott

Answer 1

Date Direct materials Direct labor Factory overhead

July 5 $3,000

July 15 $900 $450

July 17 $1,500

July 22 $1,350 $675

August 1 $1,500

August 21 $600 $300

A) Prepare the journal entries to record the costs incurred for Job 101 in the current year for (1) direct materials, (2) direct labor, and (3) factory overhead.

Account Title Debit Credit

Work in Process 6,000

Raw Materials 6,000

($3,000 + $1,500 + $1,500)

Work in Process 2,850

Wages Payable 2,850

($900 + $1,350 + $600)

Work in Process 1,425

Overhead Control 1,425

($450 + $675 + $300)

B. Prepare the journal entry to record the completion of Job 101.

Account Title Debit Credit

Finished Goods 10,275

Work in Process 10,275

($3,000 + $1,500 + $1,500 + $900 + $1,350 + $600 + $450 + $675 + $300)

C. What is the predetermined factory overhead rate for Scott.

The predetermined factory overhead rate will be calculated by dividing the factory overhead total by the direct labor total.

= $1,425/$2,850 = 50% of direct labor costs