Question

Kenworth Company uses a job-order costing system. Only three jobs—Job 105, Job 106, and Job 107—were worked on during November and December. Job 105 was completed on December 10; the other two jobs were still in production on December 31, the end of the company’s operating year. Data from the job cost sheets of the three jobs follow:

	Job Cost Sheet
	Job 105			Job 106			Job 107
November costs incurred:
Direct materials	$	19,900		$	12,700		$	0
Direct labour	$	16,400		$	10,400		$	0
Manufacturing overhead	$	24,600		$	15,600		$	0
December costs incurred:
Direct materials	$	0		$	9,900		$	28,100
Direct labour	$	6,550		$	7,700		$	13,400
Manufacturing overhead		?			?			?

The following additional information is available:

1. Manufacturing overhead is applied to jobs on the basis of direct labour cost.
2. Balances in the inventory accounts at November 30 were as follows:

Raw Materials	$	50,200
Work in Process		?
Finished Goods	$	102,000

Required: 1. Prepare T-accounts for Raw Materials, Work in Process, Finished Goods, and Manufacturing Overhead. Entert inventory balances given above; in the case of Work in Process, compute the November 30 balance and enter it Process T-account. Work in Process Beg. Bal. Beg. Bal Raw Materials 50,200 44,650 5,650 58,075 e. End. Bal. 38,000 27,650 41.475 49,050 End. Bal. Manufacturing Overhead Beg Bal Beg. Bal Finished Goods 102,000 58,075 160,075 41,475 d. End. Bal. 6.550 11,400 20,825 End. Bal. 2.700 Salaries & Wages Payable Accounts Payable Beg. Bal. Beg. Bal. 39,050 b. 20,825 End. Bal. 39,050 End, Bal 20,825 Rod text Indicatos no rxponse was expecoed in a call or a formula-based calculation is connect; na points deducted.

Answer 1

				Job cost sheet
					Job 105	Job 106	Job 107	total
	November costs incurred:
	Direct materials				19,900	12,700	0	32,600
	Direct labor				16,400	10,400	0	26,800
	Manufacturing overhead				24,600	15,600	0	40,200
	Total Beginning WIP				60,900	38,700	0	99,600
	December costs incurred:
	Direct materials				0	9,900	28,100	38,000
	Direct labor				6,550	7,700	13,400	27,650
	Manufacturing overhead				9825	11550	20100	41,475
	cost added during december				16,375	29,150	61,600	107,125
	total cost of job				77,275	67,850	61,600	206,725
1)	T-Accounts
	Raw materials					Work in progress
	Beg.bal	50,200				Beg bal	99,600
			44,550	a)		a)	38,000	77,275	e)
						b)	27,650
	End bal					d)	41,475
						End bal	129,450
	Finished goods					Manufacturing overhead
	Beg.Bal	102,000				Beg.Bal	0
	e)	77,275				a)	6,550	41,475	d)
						b)	11,400
	End bal	179,275				c)	20,825
						End bal		2,700
	Salaries & wages payable					Accounts payable
	Beg bal					Beg bal
			39,050	b)				20,825	c)
	End bal					end bal
2)	Event	General Journl				Debit	Credit
a)	1)	Work in process				38,000
		Manufacturing overhead				6,550
		Raw Materials					44,550
b)	2)	Work in process				27,650
		Manufacturing overhead				11,400
		Salaries & wages payable					39,050
c)	3)	Manufacturing overhead				20,825
		Accounts payable					20,825
3a)	predetermined overhead rate			150%
3b)		Work in process				41,475
		Manufacturing ovehead					41,475
4)		Finished goods				77,275
		Work in process inventory					77,275
5)				Job 106	job 107	total
	Direct materials			22,600	28,100	50,700
	direct labor			18,100	13,400	31,500
	manufacturing overhead			27,150	20100	47,250
	Total cost			67,850	61,600	129,450