Question

Instructions Yurman Inc. uses a job-order costing system. During the month of May, the following transactions occurred: May 1 Purchased materials on account for $29,670. 3 31 Requisitioned materials totaling $24,500 for use in production. Of the total, $9,200 was for Job 58, $8,900 for Job 59, and the remainder for Job 60. Incurred direct labor for the month of $32,400, with an average wage of $18 per hour. Job 58 used 800 hours; Job 59, 600 hours, and Job 60, 400 hours. Incurred and paid actual overhead of $17,880 (credit Various Payables). Charged overhead to production at the rate of $4.80 per direct labor hour. Completed and transferred Jobs 58 and 59 to Finished Goods. Sold Job 57 (see beginning balance of Finished Goods) and Job 58 to their respective clients on account for a price of cost plus 40%. 31 31 31

Chart of accounts

Answer 1

Yuman Inc uses a JOB ORDER costing system
We need to Account following Joural Entries to prepare Job cost
Date	Details		Debit($)	Credit($)
May-01	Material( purchase)		29,670
	Account Payable			29,670
May 3	Work in process-Job 58		9,200
	Work in process-Job 59		8,900
	Work in process-Job 60		6,400
	material			24,500
May 31	Work in process-Job 58		14,400
	Work in process-Job 59		10,800
	Work in process-Job 60		7,200
	Wages payable			32,400
	Calculation
	Job	Rate / hr(a)	Hr(b)	Cost($)(a*b)
	58	18	800	14,400
	59	18	600	10,800
	60	18	400	7,200
				32,400
May 31	Factory Overhead		17,880
	Various payable			17,880
May 31	Various payable		17,880
	Cash			17,880
May 31	Work in process-Job 58		3,840
	Work in process-Job 59		2,880
	Work in process-Job 60		1,920
	Factory Overhead			8,640

	Calculation
	Job	Rate / hr(a)	Hr(b)	Cost($)(a*b)
	58	4.8	800	3,840
	59	4.8	600	2,880
	60	4.8	400	1,920
				8,640
May 31	As per above details determined Job wise Tota cost
	Job	Material$	Labour$	Overhead$	Total Cost($)
	58	9,200	14,400	3,840	27,440
	59	8,900	10,800	2,880	22,580
	60	6,400	7,200	1,920	15,520
			Debit($)	Credit($)
May 31	Finished Goods Invenory		50,020
	Work in process-Job 58			27,440
	Work in process-Job 59			22,580
May 31	Sale proceed of Job 57 and 58
	with 40% add cost basis
	Job	Total Cost($)-a	Add-(40%*a)=b	Total Cost$(a+b)
	57	25600	10,240	35,840
	58	27,440	10,976	38,416
	Total cost to sales			74,256
			Debit($)	Credit($)
	Acount Receivable		74,256
	Sales			74,256
May 31	Cost of goods sold		53,040
	FG Inventory			53,040
	Job	Total Cost($)-a
	57	25600
	58	27440
	Transfer to FG	53040

Answer 2

As per above details determined Job wise Total cost
Job	Material$	Labour$	Overhead$	Total Cost($)
58	9,200	14,400	3,840	27,440
59	8,900	10,800	2,880	22,580
60	6,400	7,200	1,920	15,520

Answer 3

Raw Material	Amnt($)
Opening Balance	2300
Add
Purchase of Material	29,670
Total Material cost	31970
Less
Issue in Work in process	24,500
Closing raw Material	7,470

Answer 4- Derived closing Work in process - Please be note that - as mentioned above Job 58 ,59 - transferred to Finished goods inventory . ONLY job 60 is under WIP stage = cost already determined above $ 15520

Answer 5 - determined closing value of finished goods - As per above calculation only Job 59 will move under Finished goods Inventory . other Job 58 - Transfer to sale and Job 60 under WIP . So Job 59 will be transfer to FG = $ 22580 ( as above)