Question

Lamonda Corp. uses a job order cost system. On April 1, the accounts had balances as shown in the T-accounts below: The following transactions occurred during April: (a) Purchased materials on account at a cost of $233,170. (b) Requisitioned materials at a cost of $110,800, of which $15,200 was for general factory use. (c) Recorded factory labor of $224,500, of which $43,675 was indirect. (d) Incurred other costs: Selling expense Factory utilities Administrative expenses Factory rent Factory depreciation $ 35, 100 22,800 50,050 10,200 19,700 (e) Applied overhead at a rate equal to 145 percent of direct labor cost. (1) Completed jobs costing $261,850. (g) Sold jobs costing $323,370. (h) Recorded sales revenue of $512,000. Required: 1. & 2. Post the April transactions to the T-accounts and compute the balance in the accounts at the end of April. (Round your answers to 2 decimal places.) 3-a. Compute over- or underapplied manufacturing overhead. (Round your answer to 2 decimal places.) 3-b. If the balance in the Manufacturing Overhead account is closed directly to Cost of Goods Sold, will Cost of Goods Sold increase or decrease? 4. Prepare Lamonda's cost of goods manufactured report for April. (Round your answers to 2 decimal places.) 5. Prepare Lamonda's April income statement. Include any adjustment to Cost of Goods Sold needed to dispose of over- or underapplied manufacturing overhead. (Round your answers to 2 decimal places.)

Answer 1

	Raw Materials Inventory
Bal	28,900	110,800	b)
(a)	233,170
Bal.	151,270
	Work in process inventory
Bal	19,500	261,850	f)
(b)	95,600
(c )	180,825
(e )	262196.25
Bal	296,271.25
	Finished Goods inventory
Bal	124,300	323,370	(g)
(f)	261,850
Bal	62,780
	Manufacturing Overhead
Beg bal	0
(b)	15,200	262196.25	e)
( c)	43,675
(d)	22,800
(d)	10,200
(d)	19,700
End bal		150621.25
	Cost of goods sold
Beg bal	0
(g)	323,370
Bal.
	Sales Revenue
Beg.Bal		0
		512,000	(h)
end bal		512,000
	Selling and administrative expense
Beg bal	0
(d)	35,100
(d)	50,050
Bal.	85,150
3-a)
Manufacturing overhead				Overapplied		150,621.25
3-b)	Decrease
Cost of goods manufactured report
Beginning raw materials inventory						28,900
Add:Raw materials purchases						233,170
less:Indirect materials						15,200
less:Ending raw materials inventory						151,270
Direct materials used						95,600
Direct labor						180,825
Manufacturing overhead applied						262196.25
Total current manufacturing costs						538,621.25
Add:Beginning work in process inventory						19,500
less:Ending work in process inventory						296,271.25
Cost of goods manufactured.						261,850.00
Income Statement
Sales Revenue							512,000
Cost of good sold
Beginning finished goods inventory						124,300
Add cost of goods manufactured						261,850.00
less:Ending finished goods inventory						62,780
Unadjusted cost of goods sold						323,370.00
less:Overapplied manufacturing overhead						150,621.25
Adjusted cost of goods sold							172,748.75
Gross profit							339,251.25
Selling & administrative expense							85,150
Net income from operations							254,101.25