Accounting Chapter 16

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Adams Company is a manufacturing company that has worked on several production jobs during the first quarter of the year. Below is a list of all the jobs for the quarter: Job 356 $450 Job 357 $1,235 Job 358 $378 Job 359 $689 Job 360 $456 Jobs 356, 357, 358, and 359 were completed. Jobs 356 and 357 were sold at a profit of $500 on each job. What is the balance of Sales for Adams Company at the end of the first quarter?

$2685

Cavy Company estimates that total factory overhead costs will be $733,460 for the year. Direct labor hours are estimated to be 91,000. what is the predetermined factory overhead rate?

8.06

how to determine increase/decrease in net income

applied overhead - actual overhead --> positive number: increase, negative number: decrease

whats happening if there is a debit to finished goods and a credit to work in process

completed goods are transferred to finish goods

how to find factory overhead

factory overhead = predetermined factory overhead rate * direct labor hours

what's happening if there is a debit to work in process and a credit to factory overhead?

factory overhead is applied

what's happening if there is a debit to cost of goods sold and a credit to finished goods?

goods are sold

At the end of the year, overhead applied was $3,755,000. Actual overhead was $3,168,000. Closing over/underapplied overhead into Cost of Goods Sold would cause net income to

increase 587,000

What are the two main types of cost accounting systems for manufacturing operations?

job order cost and process cost systems

Which of the following would be most likely to use process costing? a. custom furniture manufacturer b. law firm c. auto body repair shop d. lawn fertilizer manufacturer

lawn fertilizer manufacturer

how to find per unit cost

per unit cost = total cost / total units

how to find predetermined factory overhead rates

predetermined factory overhead rates = estimated total factory overhead costs / estimated direct labor hours

how do you find ending cost of goods sold

sum of all jobs completed

how do you find ending sales balance

sum of all jobs completed + profit on each job

Which of the following would most likely use a job order costing system? a. company that manufactures chlorine for swimming pools b. swimming pool installer c. paper mill d. oil refinery

swimming pool installer

how to find total product cost

total cost = direct materials + direct labor + factory overhead

what's happening if there is a debit to finished goods, work in process and cost of goods of sold and there is a credit to factory overhead

underapplied overhead is allocated

Winston Company estimates that the factory overhead for the following year will be $1,134,000. The company has decided that the basis for applying factory overhead should be machine hours, which is estimated to be 37,800 hours. The total machine hours for the year were 54,300 hours. The actual factory overhead for the year was $1,652,000. What is the total factory overhead applied?

1,629,000

if job 567 has 1400 hours and the predetermined factory rate is $8.06, what is the factory overhead for the job?

11284

When Job 117 was completed, direct materials totaled $30,584; direct labor, $41,507; and factory overhead, $37,137. A total of 3,901 units were produced at a per-unit cost of

28

how to compute overapplied or underapplied factory overhead

actual factory overhead - applied factory overhead --> positive number: underapplied, negative number: overapplied

how do you journalize applied factory overhead?

debit : work in process - sum of all job factory overheads credit: factory overhead - sum of all job factory overheads

how to journalize closing entry for factory overhead if underapplied

debit: Cost of goods sold credit: factory overhead

how to journalize closing entry for factory overhead if overapplied

debit: factory overhead credit: cost of goods sold

Materials purchased on account during the month totaled $190,000. Materials requisitioned and placed in production totaled $165,000. The journal entry to record the materials purchased on account is

debit: materials $190,000 credit: accounts payable $190,000

journal entry for Labor time tickets: Job 609, $1,600; $400 for supervision

debit: work in process 1600 debit: factory overhead 400 credit: wages payable 2000

Journal entry for Raw materials issued: Job 609, $850; for general use in factory, $600

debit: work in process 850 debit: factory overhead 600 credit: raw materials 1450

what's happening if there is a debit to work in process and a credit to wages payable?

direct and indirect labor costs are incurred

what happening if there is a debit to factory overhead and work in process and a credit to materials?

direct and indirect materials are being issued


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