Question

Evelyn Campbell started Campbell Manufacturing Company to make a universal television remote control device that she had invented. The company's labor force consisted of part-time employees. The following accounting events affected Campbell Manufacturing Company during its first year of operation. (Assume that all transactions are cash transactions unless otherwise stated) Transactions for January 2018, First Month of Operation 1. Issued common stock for $10,000. 2. Purchased $430 of direct raw materials and $65 of production supplies. 3. Used $248 of direct raw materials. 4. Used 80 direct labor hours: production workers were paid $9.60 per hour 5. Expected total overhead costs for the year to be $3,200, and direct labor hours used during the year to be 1,000. Calculate an overhead rate and apply the appropriate amount of overhead costs to Vork in Process Inventory 6. Paid $144 for salaries to administrative and sales staff 7. Paid $21 for indirect manufacturing labor 8. Paid $205 for rent and utilities on the manufacturing facilities. 9. Started and completed 100 remote controls during the month; all costs were transferred from the Work in Process Inventory account to the Finished Goods Inventory account. 0. Sold 75 remote controls at a price of $21.4 each Transactions for Remainder of 2018 11. Acquired an additional $18,000 by issuing common stock. 12. Purchased $3,890 of direct raw materials and $905 of production supplies. 13. Used $3,000 of direct raw materials. 14. Paid production workers $9.60 per hour for 890 hours of work 15. Applied the appropriate overhead cost to Work in Process Inventory 16. Paid $1,550 for salaries of administrative and sales staff 17. Paid $236 of indirect manufacturing labor cost. 18. Paid $2,390 for rental and utility costs on the manufacturing facilities 19. Transferred 950 additional remote controls that cost $12.72 each from the Work in Process Inventory account to the Finished Goods Inventory account 20. Determined that $169 of production supplies was on hand at the end of the accounting period 21. Sold 860 remote controls for $21.40 each 22. Determine whether the overhead is over- or underapplied. Close the Manufacturing Overhead account to the Cost of Goods Sold account 23. Close the revenue and expense accounts Required a. For each of the above transactions, post the effects to the appropriate T-accounts. b. Prepare a schedule of cost of goods manufactured and sold, an income statement, and a balance sheet for 2018. Complete this question by entering your answers in the tabs below. Req B CGM Req B Inc Sched Req B Bal Sheet Req A Stmt ces Prepare a schedule of cost of goods manufactured and sold for 2018. (Do not round intermediate calculations.) CAMPBELL MANUFACTURING COMPANY Cost of Goods Manufactured and Sold For the Year, 2018 Beginning raw materials inventory Beginning raw materials inventory Raw materials available Ending raw materials inventory Raw materials used 0 Labor Total manufacturing costs Beginning work in process inventory es Total work in process inventory Ending work in process inventory Cost of goods manufactured Beginning finished goods inventory Goods available for sale 0 Ending finished goods inventory Cost of goods sold 0 Complete this question by entering your answers in the tabs below. Req B CGM Req B IncReq B Bal Stmt Req A Sched Sheet Prepare an income statement for 2018. (Do not round intermediate calculations.) Do not round intermediate calculations. CAMPBELL MANUFACTURING COMPANY Income Statements For the Year, 2018 Sales revenue Cost of goods sold Gross margin Selling and administrative expense Net income Prepare a balance sheet for 2018. (Do not round intermediate calculations.) CAMPBELL MANUFACTURING COMPANY Balance Sheets At the year ended 2018 Assets Cash Raw materials inventory Work in process inventor Finished goods inventory Total assets 0 Equity Common stock Retained earnings Total equity

Answer 1

		T-ACCOUNTS
		Cash
	Ref	Description	Debit	Credit
	1	Issue of Common stock	$10,000
	2	Raw materials & Production supplies		$495	(430+65)
	4	Payment-direct labor		$768	(80*9.6)
	6	Sales and administrative salaries		$144
	7	Payment-indirect labor		$21
	8	Rent and utilities		$205
	10	Sales	$1,605
	11	Issue of Common stock	$18,000
	12	Raw materials & Production supplies		$4,795	(3890+905)
	14	Payment-direct labor		$8,544	(890*9.6)
	16	Sales and administrative salaries		$1,550
	17	Payment-indirect labor		$236
	18	Rent and utilities		$2,390
	21	Sales	$18,404
		Ending balance	$28,861
		Raw Material Inventory
	Ref	Description	Debit	Credit
	2	Cash	$430
	3	Workin process		$248
	12	Cash	$3,890
	13	Workin process		$3,000
		Ending Balance	$1,072
		Work in process inventory
	Ref	Description	Debit	Credit
	3	Direct materials	$248
	4	Direct labor	$768
	5	Manufacturing Overhead -Applied	$256		(3200/1000)*80
	9	Transfer to Finished goods		$1,272
	13	Direct materials	$3,000
	14	Direct labor	$8,544
	15	Manufacturing Overhead -Applied	$2,848		(3.2*890)
	19	Transfer to Finished goods		$12,084	(950*12.72)
		Ending Balance	$2,308
		Production Supplies
	Ref	Description	Debit	Credit
	2	Cash	$65
	12	Cash	$905
	20	Manufacturing Overhead		$801	(905+65-169)
		Ending Balance	$169
		Finished Goods Inventory
	Ref	Description	Debit	Credit
	9	Work in   process(100units)	$1,272
	10	Cost of goods sold (75 units)		$954	(1272/100)*75
	19	Work in   process(950units)	$12,084
	21	Cost of goods sold (860 units)		$10,939	(12.72*860)
		Ending balance	$1,463
		Common Stock
	Ref	Description	Debit	Credit
	1	Cash		$10,000
	11	Cash		$18,000
		Ending Balance		$28,000
		Manufacturing Overhead
	Ref	Description	Debit	Credit
	5	Work in process		$256
	7	Indirect labor	$21
	8	Rent and utilities	$205
	15	Work in process		$2,848
	17	Indirect labor	$236
	18	Rent and utilities	$2,390
	20	Production Supplies	$801
	22	Cost of goods sold		$549
		Cost of Goods Sold
	Ref	Description	Debit	Credit
	10	Finished goods inventory (75 units)	$954
	21	Finished goods inventory (860 units)	$10,939
	22	Under applied overhead	$549
	23	Income Summary		$12,442
		Sales and Administrative Salaries
	Ref	Description	Debit	Credit
	6	Cash	$144
	16	Cash	$1,550
	23	Income summary		$1,694
		Sales Revenue
	Ref	Description	Debit	Credit
	10	Cash		$1,605	(21.4*75)
	21	Cash		$18,404	(21.4*860)
	23	Income Summary	$20,009
		Income Summary
	Ref	Description	Debit	Credit
	23	Sales Revenue		$20,009
	23	Cost of goods sold	$12,442
	23	Sales and Administrative salaries	$1,694
			Income Summary Ref Description Debit Credit $20,009 23 Sales Revenue $12,442 23 Cost of goods sold $1,694 23 Sales and Administrattive salaries Cost of goods manufactured and sold $0 Beginning Raw material inventor 4,320 Raw material Purchased 4,320 Raw materialavailable $1,072 Ending Raw material inventory $3,248 $9,312 Raw materials used Labor $3,653 Manufacturing Overhead $16,213 Total Manufacturing Cost $0 Beginning Workin process $16,213 Total Workin process inventor $2,308 Ending Workin Process inventor $13,905 Cost of goods manufactured Beginning finished goods inventor $0 $13,905 Goods available for Sale $1,463 Ending Finished goods inventor Cost of goods Sold $12,442 Income Statement $20,009 Sales Revenue $12,442 Cost of goods sold $7,567 Gross margin $1,694 Selling & Admin.expenses $5,873 Net Income Balance Sheet Assets: $28,861 Cash $1,072 Raw materials inventor $2,308 Work in process inventory $1,463 Finished goods inventor $169 Production Supplies $33,873 Totalassets Equity: $28,000 Common Stock $5,873 Retained earnings $33,873 TotalEquity