The following events took place for Rockhaven Biking Inc. during February, the first month of operations as a producer of road bikes Purchased $401,300 of materials. • Used $345,100 of direct materials in production. Incurred $296,000 of direct labor wages. • Applied factory overhead at a rate of 70% of direct labor cost. • Transferred $814,400 of work in process to finished goods. Sold goods with a cost of $798,600. • Revenues earned by selling bikes, $1,429,500. • Incurred $343,400 of selling expenses. Incurred $127,800 of administrative expenses.

The following events took place for Rockhaven Biking Inc. during February, the first month of operations as a producer of road bikes Purchased $401,300 of materials. • Used $345,100 of direct materials in production. Incurred $296,000 of direct labor wages. • Applied factory overhead at a rate of 70% of direct labor cost. • Transferred $814,400 of work in process to finished goods. Sold goods with a cost of $798,600. • Revenues earned by selling bikes, $1,429,500. • Incurred $343,400 of selling expenses. Incurred $127,800 of administrative expenses.

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter2: Job Order Costing

Section: Chapter Questions

Problem 14E: The following events took place for Rushmore Biking Inc. during February, the first month of...

See similar textbooks

Similar questions

Glasson Manufacturing Co. produces only one product. You have obtained the following information from the corporations books and records for the current year ended December 31, 2016: a. Total manufacturing cost during the year was 1,000,000, including direct materials, direct labor, and factory overhead. b. Cost of goods manufactured during the year was 970,000. c. Factory Overhead charged to Work in Process was 75% of direct labor cost and 27% of the total manufacturing cost. d. The beginning Work in Process inventory, on January 1, was 40% of the ending Work in Process inventory, on December 31. e. Material purchases were 400,000 and the ending balance in Materials inventory was 60,000. No indirect materials were used in production. Required: Prepare a statement of cost of goods manufactured for the year ended December 31 for Glasson Manufacturing. (Hint: Set up a statement of cost of goods manufactured, putting the given information in the appropriate spaces and solving for the unknown information.)
The records of Burris Inc. reflect the following data: Work in process, beginning of month2,000 units one-half completed at a cost of 1,250 for materials, 675 for labor, and 950 for overhead. Production costs for the monthmaterials, 99,150; labor, 54,925; factory overhead, 75,050. Units completed and transferred to stock38,500. Work in process, end of month3,000 units, one-half completed. Compute the months unit cost for each element of manufacturing cost and the total per unit cost.
The records of Stone Inc. reflect the following data: Work in process, beginning of month4,000 units one-fourth completed at a cost of 2,500 for materials, 1,400 for labor, and 1,800 for overhead. Production costs for the monthmaterials, 130,000; labor, 70,000; and factory overhead, 82,000. Units completed and transferred to stock45,000. Work in process, end of month5,000 units, one-half completed. Compute the months unit cost for each element of manufacturing cost and the total per unit cost. (Round unit costs to three decimal places.)
Baldwin Printing Company uses a job order cost system and applies overhead based on machine hours. A total of 150,000 machine hours have been budgeted for the year. During the year, an order for 1,000 units was completed and incurred the following: The accountant computed the inventory cost of this order to be 4.30 per unit. The annual budgeted overhead in dollars was: a. 577,500. b. 600,000. c. 645,000. d. 660,000.
The cost accountant for River Rock Beverage Co. estimated that total factory overhead cost for the Blending Department for the coming fiscal year beginning February 1 would be 3,150,000, and total direct labor costs would be 1,800,000. During February, the actual direct labor cost totalled 160,000, and factory overhead cost incurred totaled 283,900. a. What is the predetermined factory overhead rate based on direct labor cost? b. Journalize the entry to apply factory overhead to production for February. c. What is the February 28 balance of the account Factory OverheadBlending Department? d. Does the balance in part (c) represent over- or underapplied factory overhead?
Rockford Company has four departmental accounts: Building Maintenance, General Factory Overhead, Machining, and Assembly. The direct labor hour method is used to apply factory overhead to the jobs being worked on in Machining and Assembly. The company expects each production department to use 30,000 direct labor hours during the year. The estimated overhead rates for the year include the following: During the year, both Machining and Assembly used 28,000 direct labor hours. Factory overhead costs incurred during the year follow: In determining application rates at the beginning of the year, cost allocations were made as follows, using the sequential distribution method: Building Maintenance to: General Factory Overhead, 10%; Machining, 50%; Assembly, 40%. General factory overhead was distributed according to direct labor hours. Required: Determine the under- or overapplied overhead for each production department. (Hint: First you must distribute the service department costs.)
Financial Statements of a Manufacturing Firm The following events took place for Focault Inc. during July 20Y2, the first month of operations as a producer of road bikes: • Purchased $267,400 of materials • Used $230,000 of direct materials in production • Incurred $196,000 of direct labor wages • Applied factory overhead at a rate of 75% of direct labor cost • Transferred $550,100 of work in process to finished goods • Sold goods with a cost of $532,100 • Sold goods for $952,500 • Incurred $228,800 of selling expenses • Incurred $85,100 of administrative expenses a. Prepare the July income statement for Focault. Assume that Focault uses the perpetual inventory method. Focault Inc. Income Statement For the Month Ended July 31, 20Y2 Selling and administrative expenses: Total selling and administrative expenses b. Determine the inventory balances at the end of the first month of operations. Materials inventory, July 31 Work in process inventory, July 31 Finished goods inventory, July 31
Financial Statements of a Manufacturing Firm The following events took place for Rushmore Biking Inc. during February, the first month of operations as a producer of road bikes: • Purchased $385,900 of materials. • Used $331,900 of direct materials in production. • Incurred $284,000 of direct labor wages. • Applied factory overhead at a rate of 80% of direct labor cost. • Transferred $809,400 of work in process to finished goods. • Sold goods with a cost of $771,800. • Revenues earned by selling bikes, $1,381,500. • Incurred $331,900 of selling expenses. • Incurred $123,500 of administrative expenses. a. Prepare the income statement for Rushmore Biking Inc. for the month ending February 28. Assume that Rushmore Biking Inc. uses the perpetual inventory method. Rushmore Biking Inc. Income Statement For the Month Ended February 28 $ $ Selling and administrative expenses: $ Total selling and administrative…
Financial Statements of a Manufacturing Firm The following events took place for Rushmore Biking Inc. during February, the first month of operations as a producer of road bikes: • Purchased $570,100 of materials. • Used $490,300 of direct materials in production. • Incurred $420,000 of direct labor wages. • Applied factory overhead at a rate of 80% of direct labor cost. • Transferred $1,196,400 of work in process to finished goods. • Sold goods with a cost of $1,128,800. • Revenues earned by selling bikes, $2,020,600. • Incurred $485,400 of selling expenses. • Incurred $180,600 of administrative expenses. a. Prepare the income statement for Rushmore Biking Inc. for the month ending February 28. Assume that Rushmore Biking Inc. uses the perpetual inventory method.
Financial Statements of a Manufacturing Firm The following events took place for Rushmore Biking Inc. during February, the first month of operations as a p of road bikes: • Purchased $385,900 of materials. • Used $331,900 of direct materials in production. • Incurred $284,000 of direct labor wages. • Applied factory overhead at a rate of 80% of direct labor cost. • Transferred $809,400 of work in process to finished goods. • Sold goods with a cost of $771,800. • Revenues earned by selling bikes, $1,381,500. • Incurred $331,900 of selling expenses. • Incurred $123,500 of administrative expenses. a. Prepare the income statement for Rushmore Biking Inc. for the month ending February 28. Assume that Rushmore Biking Inc. uses the perpetual inventory method. Rushmore Biking Inc. Income Statement For the Month Ended February 28 Selling and administrative expenses: $ Total selling and administrative expenses b. Determine the inventory balances on February 28, the end of the first month of…
Financial Statements of a Manufacturing Firm The following events took place for Rushmore Biking Inc. during February, the first month of operations as a producer of road bikes: • Purchased $509,100 of materials. • Used $437,800 of direct materials in production. • Incurred $376,000 of direct labor wages. • Applied factory overhead at a rate of 80% of direct labor cost. • Transferred $1,070,000 of work in process to finished goods. • Sold goods with a cost of $1,018,200. • Revenues earned by selling bikes, $1,822,600. • Incurred $437,800 of selling expenses. • Incurred $162,900 of administrative expenses. a. Prepare the income statement for Rushmore Biking Inc. for the month ending February 28. Assume that Rushmore Biking Inc. uses the perpetual inventory method. Rushmore Biking Inc.Income StatementFor the Month Ended February 28 $- Select - - Select - $- Select - Selling and administrative expenses: blank blank $- Select…
Financial Statements of a Manufacturing Firm The following events took place for Focault Inc. during July 20Y2, the first month of operations as a producer of road bikes: • Purchased $517,700 of materials Used $445,200 of direct materials in production • Incurred $384,000 of direct labor wages • Applied factory overhead at a rate of 80% of direct labor cost • Transferred $1,090,900 of work in process to finished goods • Sold goods with a cost of $1,035,400 • Sold goods for $1,853,400 • Incurred $445,200 of selling expenses • Incurred $165,700 of administrative expenses a. Prepare the July income statement for Focault. Assume that Focault uses the perpetual inventory method. Focault Inc. Income Statement For the Month Ended July 31, 20Y2 Revenues Cost of goods sold Gross profit Selling and administrative expenses: Selling expenses 5,200 Administrative expenses 165,700 Total selling and administrative expenses 610,900 Income from operations