Reference no: EM131211289
Construction, Inc. is a home builder in Arizona. Sunrise uses a job order costing system in which each house is a job. Because it constructs houses, the company uses an account titled Construction Overhead. The company applies overhead based on estimated direct labor costs. For the year, it estimated construction overhead of $1,000,000 and total direct labor cost of $5,000,000. The following events occurred during August. a. Purchased materials on? account, $420,000 b. Requisitioned direct materials and used direct labor in construction. Recorded the materials requisitioned. Direct Materials Direct Labor House 402 - Direct Materials: $57,000 Direct Labor: $42,000 House 403 - Direct Materials $67,000 Direct Labor: $34,000 House 404 - Direct Materials $64,000 Direct Labor: $53,000 House 405 - Direct Materials: $88,000 Direct Labor: $52,000 c. The company incurred total wages of $$260,000. Use the data from Item b to assign the wages. Wages are not yet paid. d. Depreciation of construction? equipment, 6,400 e. Other overhead costs? incurred: Equipment rentals paid in? cash, $31,000?; Worker liability insurance? expired, $4,000. f. Allocated overhead to jobs. g. Houses? completed: 402, 404 h. House sold on? account: 404 for $240,000 Requirements: 1. Calculate Sunrise?'s predetermined overhead allocation rate for the year. 2. Prepare journal entries to record the events in the general journal. 3. ?T-accounts for? Work-in-Process Inventory and Finished Goods Inventory have been opened for you. Post the appropriate entries to these? accounts, identifying each entry by letter. Determine the ending account? balances, assuming that the beginning balances were zero. 4. Add the costs of the unfinished? houses, and show that this total amount equals the ending balance in the? Work-in-Process Inventory account. 5. Add the cost of the completed house that has not yet been? sold, and show that this equals the ending balance in Finished Goods Inventory. 6. Compute gross profit on the house that was sold. What costs must gross profit cover for SunriseSunrise ?Construction?
|
Collect industrial benchmarks or ratios for the ratios
: Collect the most recent 10-K, including financial statements, their footnotes, and management discussion for one of the following primary firms: In addition, you need to collect industrial benchmarks or ratios for the ratios you need to calculate (Se..
|
|
Bond premium is amortized on straight-line basis
: On January 1, 2016, $346,000 of debentures are converted into common stock, which is then selling at $114. An additional $346,000 of debentures are converted on March 31, 2016. The market price of the common stock is then $119. Accrued interest at Ma..
|
|
What is tax treatment for casualty and theft transactions
: Which additional criterion is needed to qualify the sale of unharvested crops as Section 1231 property? A taxpayer’s gain and losses for the year pertaining to business assets that qualify as section 1231 property are as follows: There are no non-rec..
|
|
Determine the mutually beneficial transfer price
: The Molding Division of Cotwold Company manufactures a plastic casing used by the Assembly Division. This casing is also sold to external customers for $37 per unit. Variable costs for the casing are $12 per unit and fixed cost is $5 per unit. Determ..
|
|
Calculate sunrise? predetermined overhead allocation rate
: Construction, Inc. is a home builder in Arizona. Sunrise uses a job order costing system in which each house is a job. Because it constructs houses, the company uses an account titled Construction Overhead. The company applies overhead based on estim..
|
|
Ending balance on a bank reconciliation
: In theory shouldn't an ending trial balance for a cash account match the ending balance on a bank reconciliation for the same month? If not, please provide examples why it may not balance. Please explain your answer.
|
|
The non-corporate and corporate taxpayer capital gains
: A non-corporate taxpayer has two transactions involving the sale of capital assets during the year. As a result of the transactions, he has a short-term capital gain of $2000 and a long-term capital loss of $6000. A corporate taxpayer has the identic..
|
|
Units of production for materials and conversion costs
: The Finishing Department of Curtis Corporation reports the following for January 2011: Production: All materials are added at the beginning of the process. Beginning work in process 20,000 units, 60% complete. Units started into production 240,000 un..
|
|
Determine the amount of the lease payments
: On January 1, 2014, P & P Products entered into an agreement to lease a piece of equipment from Beta Company, Inc. (the lessor). The lease term is five years and the interest rate is 8 percent. Make the original lease entry(ies) on January 1, 2014. D..
|