Student Name: Class: Problem 07-43A DUNGAN CABINETRY Requirement a: 1. Purchased $53,700 in materials on account.

Acc # Materials Inventory Accounts Payable

53,700 53,700
- Correct!

2. Issued $1,500 in supplies from the materials inventory to the production department. Acc # Manufacturing Overhead Control 1,500 Materials Inventory 1,500 3. Paid for the materials purchased in (1) Acc # Accounts Payable Cash

- Correct!

53,700 53,700
- Correct!

4. Issued $25,500 in direct materials to the production department. Acc # Work-In-Process 25,500 Materials Inventory

25,500

- Correct!

5. Incurred wage costs of $42,000, which were debited to payroll, a temporary account. Of this amount, $13,500 was withheld for payroll taxes and credited to payroll taxes payable. The remaining 28,500 was paid to the employees. See transactions (6) and (7) for additional information about payroll. Acc # Payroll - Correct! 42,000 Cash 28,500 Payroll Taxes Payable 13,500

6. Recognized $21,000 in fringe benefit costs, incurred as a result of the wages paid in (5). This $21,000 was debited to Payroll and credited to Fringe Benefits Payable. Acc # Payroll 21,000 Fringe Benefits Payable 21,000

- Correct!

7. Analyzed the Payroll account and determined that 60 percent represented direct labor; 30 percent, indirect manufacturing labor, and 10 percent, administrative and marketing costs. For this entry you will need to compute the amounts debited and credited. Acc # Manufacturing Overhead 37,800 Manufacturing Overhead Control 18,900 Administrative and Marketing Costs 6,300 - Correct! Payroll 63,000 8. Paid for utilities, power, equipment maintenance, and other miscellaneous items for the manufacturing plant totaling $32,400. Acc # Manufacturing Overhead Control 32,400 Cash 32,400 9. Applied overhead on the basis of 175 percent of direct labor costs. For this entry you will need to compute the amounts debited and credited. Acc # Applied Manufacturing Overhead 66,150 Manufacturing Overhead Control

- Correct!

66,150

- Correct!

10. Recognized depreciation of $17,250 on manufacturing property, plant, and equipment. Acc # Manufacturing Overhead Control 17,250 Accumulated Depreciation 17,250

- Correct!

Given Data P07-43: DUNGAN CABINETRY January transactions: 1. Purchased materials on account. 2. Issued supplies from materials inventory to production department. 3. Paid for materials purchased in (1). 4. Issued direct materials to production department. 5. Incurred wage costs: Paid in cash to employees Withheld for payroll taxes 6. Recognized fringe benefit costs as a result of payroll in (5). 7. Analysis of payroll costs incurred in (5): Percentage represented by direct labor. Percentage represented by indirect manufacturing labor. Percentage represented by administrative and marketing. 8. Paid for utilities, power, equipment maintenance, and other misc. items for manufacturing plant. 9. Percent of overhead applied based on direct labor costs. 10. Recognized depreciation on manufacturing property, plant, and equipment. Account Balances: Materials Inventory Work-In=Process Inventory Finished Goods Inventory Cost of Goods Sold $ Beginning 88,857 12,375 62,250 Ending $ 49,800 98,775

$ $ $ $ $ $

53,700 1,500 25,500 28,500 13,500 21,000 60% 30% 10%

$ $

32,400 175% 17,250

Student Name: Class: Problem 07-46A TOLEDO FARM IMPLEMENTS

This problem is arranged so that it can be solved one step at a time. The T account for Workin-Process to the right shows you what information you need to solve the problem. Some of the information is given in the problem. Most of the information you will need to compute, and those parts are identified with the letters a thru e. After you have successfully computed each item, put your answers in the second Work-in-Process T Account to find out if you are correct.

(a) (b) (c) (e)

Work-in-Process Beginning balance Transferred out Direct materials Disaster loss Direct labor Overhead applied Ending balance Work-in-Process

(d) (f)

This is a challenging problem. To keep it challenging you will need to set up your own computations for the missing data. Only the final items in the Work-in-Process T account above will be identified as correct or incorrect. Step b. To compute the direct materials added to work-in-process, you will first have to compute materials purchased. Compute purchases in the shaded area below. Ending balance in Accounts Payable Cash payment during May subtotal less beginning balance Purchases Compute direct materials added to production in the space below. Beginning materials inventory purchases subtotal less: Ending Inventory Indirect materials Direct materials used Step c. Computation of Direct Labor Payroll Less Indirect Labor Direct Labor

Step d.

Computation of amount transferred out of Work-in-Process. Ending balance of Finished Goods Plus Cost of Goods Sold during May: Balance at the end of May Balance at the beginning of May subtotal Less Beginning balance of Finished Goods Amount transferred to Finished Goods from Work-in-Process

Step e.

Computation of Overapplied Applied during May Ending balance in Manufacturing Overhead Less beginning balance in Manufacturing Overhead subtotal Add overapplied overhead Overhead applied during May

Step f.

Computation of the loss from the Tornado Debits to the Work-in-Process account: Beginning balance Materials added Labor added Overhead added Total debits Less goods transferred out Total loss from the Tornado

Given Data P07-46: TOLEDO FARM IMPLEMENTS Information from April financial statements: Materials inventory, April 30 Work-in-process inventory, April 30 Finished goods inventory, April 30 Cost of goods sold through April 30 Accounts payable ( materials suppliers), April 30 Manufacturing overhead through April 30 Payroll payable, April 30 Withholding and other payroll liabilities, April 30 Overhead applied through April 30 Inventories on hand May 31: Materials inventory Work-in-process inventory Finished goods inventory Available balances at end of May: Manufacturing overhead through May 31 Cost of goods sold through May 31 Additional Information: Outstanding bills to suppliers Cash payments to suppliers during the month Manufacturing section payroll costs last month Indirect labor portion of payroll costs Indirect materials (from scrap of paper under desk) Amount of overhead overapplied during the month

98,000 172,400 64,000 697,200 43,200 369,800 19,400 359,200

86,000 ? 75,000

434,000 793,200

100,200 75,800 164,800 29,400 4,172 2,400

Student Name: Class: Problem 07-48A CHELSEA HOUSEHOLD RENOVATIONS Use the T accounts provided to determine the information needed for the management report. Cash or Accounts Payable $ 40,000
Correct!

Actual overhead costs for June

Actual overhead costs for June

Wages Payable $ 64,000

Correct!

Actual overhead costs for June

Overhead Actual Applied 40,000 $ 32,000

Correct! Correct!

Direct Materials Direct Labor Manufacturing Overhead Labor added in June Overhead added in June Total cost of goods sold Job 61 Transferred to cost of goods sold Final Balance

Work-in-Process - Job 61 $ 4,000 19,200 9,600 32,800 19,200 9,600 61,600 $ 61,600 Correct! $ Correct!

Materials added in June Labor added in June Overhead added in June Total cost of goods sold Job 62 Transferred to cost of goods sold Final Balance

Work-in-Process - Job 62 $ 6,000 24,000 12,000 42,000 $ 42,000 Correct! $ Correct!

Materials added in June Labor added in June Overhead added in June Final Balance

Work-in-Process - Job 63 $ 3,200 20,800 10,400 $ 34,400

Correct!

Job 61 Job 62 Total for June

$ $

Cost of Goods Sold 61,600 42,000 103,600

Correct!

Underapplied Overhead $ 8,000

Correct!

If you need space to make computations, the yellow area below is unprotected.

Given Data P07-48: CHELSEA HOUSEHOLD RENOVATIONS Information for June: Completed Job 61 Started and completed Job 62 Started Job 63 Work-in-process inventory (excluding applied overhead): May 31: Job 61 Direct materials Labor (960 hours X $20) June 30: Job 63 Direct materials Labor (1040 hours X $20) Percentage each job complete as to labor-hours May 31 Direct materials inventories Finished goods inventories June 30 Direct materials inventories Finished goods inventories Actual overhead

$ $ $ $

4,000 19,200 3,200 20,800 50%

$ $ $ $ $

40,000

Cost of goods sold (before adjustment for over- or underapplied overhead) Job 61 Materials $ 4,000 Labor ? Overhead ? Job 62 Materials ? Labor ? Overhead ? Direct materials purchased in June $ 64,000