Reference no: EM132596424

The following data from the just completed year are taken from the accounting records of Kenton Company:

Sales $ 975,000

Direct labor cost $ 165,000

Raw material purchases $ 229,000

Selling expense $ 48,750

Administrative expenses $ 146,250

Manufacturing overhead applied to work in process $ 180,000

Actual manufacturing overhead costs $ 175,050

Inventories:

              Beginning Ending

Raw materials $ 18,000 $ 17,500

Work in process $ 20,000 $ 14,750

Finished goods $ 9,000 $ 11,000

Required:

1. Prepare a schedule of cost of goods manufactured. Assume all raw materials used in production were direct materials.

2. Prepare a schedule of cost of goods sold. Assume that the company's under applied or over applied overhead is closed to Cost of Goods Sold.

3. Prepare an income statement. Job Order Costing (5% Grade) The Searider Company uses a job-order costing system.

The following transactions occurred in April:

a. Raw materials were purchased on account, $180,000.

b. Raw materials used in production, $148,000 ($130,000 direct materials and $18,000 indirect materials). c. Accrued direct labor cost of $75,000 and indirect labor cost of $105,000.

d. Depreciation recorded on factory equipment, $40,000.

e. Other manufacturing overhead costs accrued during April, $118,000.

f. The company applies manufacturing overhead cost to production using a predetermined overhead rate of $6 per machine-hours. A total of 46,000 machine-hours were used in April.

g. Jobs costing $495,000 according to their job cost sheets were completed during April and transferred to Finished Goods.

h. Jobs that had cost $450,000 to complete according to their job cost sheets were shipped to customers during the month. These jobs were sold on account at 30% above cost.

Required:

1. Prepare journal entries to record the transactions given above.

2. Prepare T-accounts for Manufacturing Overhead and Work in Process. Post the relevant transactions from above to each account. Compute the ending balance in each account, assuming that Work in Process has a beginning balance of $39,000.