1. Manufacturing Costs
1 FOH Rate to Direct Labour
Direct Labour=
FOH =
FOH Rate=
800000
640000
80%
140000
50000
40000
90000
50000
2. Manufacturing Costs
Direct Material Cost=
280000
Direct Labour Cost=
320000
FOH Costs
Indirect Labour=
80000
Indirect Material=
20000
Other FOH=
124000
224000
Total Manufacturing Costs=
824000
Coversion Cost=
544000
Rate of Direct Labour =
0.5882353
Closing Finished Goods=
Less Direct Material Cost=
Conversion cost=
Labour Cost=
FOH Cost
3. Manufacturing Costs
Televane Company
Cost of goods Manufactured and Sold Statement
For the Period ended on 31st, December 19b
176000
40000
136000
80000
56000
Description
Amount
Direct Material
Opening Inventory of Raw Material
1
Add Purchases
Cost of Material Available for use
Less: Closing Inventory of Raw Material
Direct Material Used
Direct Labour Cost
Factory over head Cost
Total Manufacturing Cost
Add Opening Work in Process Inventory
Cost of goods to be manufactured
Less: Closing Work in process Inventory
2 Cost of Goods manufactured
Add Opening Finished Goods Inventory
Cost of goods available for sale
Less: Closing Finished Goods Inventory
3 Cost of Goods Sold
$
75
336
411
85
326
225
135
686
80
766
30
736
90
826
110
716
4. Manufacturing Costs
Krieger Company
Material Cost=
Direct Labour Cost=
Factor Over Head =
Molding Department=2.7* 1000=
Decorating Department=
1 Estimated Cost to Produce=
Mark Up=
2 Bid Price=
13000
15000
2700
5250
7950
35950
16177.5
52127.5
28000
22950
5. Income Statement
Hansford Inc.
Income Statement
For the Period ended on 30th, September
Description
Amount
$
Sales
Direct Material
Opening Inventory of Raw Material
Add Purchases
Cost of Material Available for use
Less: Closing Inventory of Raw Material
Direct Material Used
Direct Labour Cost
Factory over head Cost
Total Manufacturing Cost
Add Opening Work in Process Inventory
Cost of goods to be manufactured
Less: Closing Work in process Inventory
1 Cost of Goods manufactured
Add Opening Finished Goods Inventory
Cost of goods available for sale
Less: Closing Finished Goods Inventory
Cost of Goods Sold at Normal
Add/Less FOH Variance
Cost of Goods Sold at actual
Gross Profit
Less Operating Expenses
Marketing Expenses
Admn Expenses
Total Expenses
Net Profit
$
182000
7000
42300
49300
7400
41900
30000
45000
116900
9600
126500
13000
113500
15000
128500
17500
111000
3200
114200
67800
14100
22900
37000
30800
600
331
200
1131
90 Hrs
70 Hrs
Factory Overhead
week of Sept 20
week of Sept 26
Total
90 Hrs
70 Hrs
@$6.20 Hrs
@$7.30 Hrs
558
511
1069
@$5 Hrs
@$5 Hrs
450
350
800
3000
1200
4200
Description
P.R
Amount
Debit($) Credit($)
40000
48000
42000
24000
28800
110000
130000
25200
FOH analysis
Job Cost
Finished Job 36
Job Cost
Finsihed Job 37
Work in Process Job 36
Work in Process Job 37
Job No 36 & 37 Completed
Sheet
Sheet
78000
144000
128800
144000
128800
Description
P.R
Debit($)
36000
30000
40000
72000
70000
80000
36000
35000
40000
Credit($)
106000
222000
111000
Finished Job 97
Finsihed Job 98
Work in Process Job 97
Work in Process Job 98
Job No. 36 & 37 Completed
240000
135000
240000
240000
135000
240000
Accounts Receivables
Sales
Job No. 97 Sold on account
300000
300000
9. Journal entries for the Cost Accounting cycle: Predetermied Overhead rate
Ledger Accounts
Opening
1 Finished Goods
40000
WIP
CGS
375000
Closing
55000
430000
390000
430000
O/B
O/b
Material
Labour
FOH
3 Material
5000
Applied
90000
95000
Closing
Sundry
CGS
100000
Closing
10000
120000
0
120000
100000
5 Applied FOH
Opening
WIP
520000
520000
400000
120000
O/B
F.Goods
520000
Closing
Closing
975000
O/B
F.Goods
Closing
Closing
975000
15000
405000
117000
3000 CGS
120000
Closing
390000
WIP
Purchases
2 Work in Process
35000
90000 F.Goods
160000
120000 Closing
405000
972000
975000
Amount
975000
975000
Date
a
Description
P.R
Debit($)
Credit($)
90000
160000
120000
Finished Goods
390000
Work in Process Control
390000
Work in Process Completed and transferred to Finished goods
FOH Applied
Cost of Goods Sold
Under applied FOH Recorded
Material Control
Voucher Payable
375000
375000
3000
3000
95000
95000
Problems Chapter 3
3.1 Manufacturing Costs
Hulse Company
Cost of Goods Sold Statement
For the Period ended on 31st, December
Description
$
Direct Material
Opening Inventory of Raw Material
Add Purchases
Cost of Material Available for use
Less: Closing Inventory of Raw Material
Direct Material Used
Direct Labour Cost
Grinding Department 8000*5.6
Machining Department 4600*6
Factory over head Cost
Grinding Department 8000*6
Machining Department 4600*8
1 Total Manufacturing Cost
Add Opening Work in Process Inventory
Cost of goods to be manufactured
Less: Closing Work in process Inventory
2 Cost of Goods manufactured
Add Opening Finished Goods Inventory
Cost of goods available for sale
Less: Closing Finished Goods Inventory
3 Cost of Goods Sold
4 Coversion Cost
Amount
$
20000
58000
78000
18000
60000
44800
27600
48000
36800
72400
84800
217200
15000
232200
17600
214600
22000
236600
17000
219600
157200
58000
3.1
Ledger Accounts
1 Material Control
O/B
20000 WIP
60000
O/b
4 Work in process
15000
Purchases
FOH app
Payroll
material
58000
Closing
78000
18000
84800 F Goods
72400
60000 Closing
232200
214600
17600
232200
78000
Opening
2 Accrued Payroll
72400 WIP G.Dept
5 Finished Goods
22000
CGS
V/Payable
WIP
44800
27600
WIP M.Dept
Closing
236600
72400
(5)
219600
214600
17000
236600
72400
3 FOH Applied
FOH Control
84800 WIP G.Dept
48000
36800
WIP M.Dept
84800
84800
219600
3 FOH Controal
FOH App
84800
84800
Goods to be Manufactured
Less Closing WIP
Cost of Goods Mfgd
3 add opeing F. goods
Cost of Goods to be sold
Less Closing F.goods
Cost of Goods Sold
4 Conversion Cost
Direct MaterIal
72400
217200
15000
232200
17600
214600
22000
236600
17000
219600
Applied FOH
60000
132400
O/B
Purchases
Material Control
20000 WIP
60000
58000
Closing
78000
18000
78000
1 Finished Goods
70000
CGS
WIP
(5)
230000
220000
Closing
290000
60000
290000
O/b
2 FOH app
Payroll
1 material
2 Work in process
50000
75000 F Goods
100000
35000 Closing*
260000
220000 (4)
40000 (3)
260000
3 Material Control
10000 WIP
50000
Closing
35000
F.Goods
FOH Cont
C/B
25000
235000
60000
Payed
5 Accrued Payroll
140000 Opening
Direct Lab
20000 Ind Lab
Closing
160000
60000
10000
100000
50000
150000
6 FOH Controal
10000 FOH App
50000
20000 CGS
Acc Dep
Payroll
Sundry acc
80000
7 FOH Applied
75000 WIP
75000
5000
80000
8 Accounts Payables
O/B
FOH Cont
235000
235000
75000
Cash
55000 Purchases
20000
50000
Closing
75000
75000
15000
70000
70000
Problem 3-3
1)
Columbus Company
Cost of Goods Sold Statement
For the Period ended on 31st October
Description
Amount
$
Direct Material
Opening Inventory of Raw Material
Add Purchases
Cost of Material Available for use
Less: Closing Inventory of Raw Material
Direct Material Used
Direct Labour Cost
Factory over head Cost
Total Manufacturing Cost
Add Opening Work in Process Inventory
Cost of goods to be manufactured
Less: Closing Work in process Inventory
1 Cost of Goods manufactured
Add Opening Finished Goods Inventory
Cost of goods available for sale
Less: Closing Finished Goods Inventory
Cost of Goods Sold at Normal
40700
24800
65500
35700
29800
18600
27450
75850
4070
79920
4440
75480 75180/20400
9800
85280
9250 (2800+20400-20700)
76030
3.7
2500
Net Sales
Cost of Goods Sold at Normal
Gross Profit
Less Operating Expenses
Marketing Expenses
Paid
Dep Building
Dep Equipment
Admn Expenses
Paid
Dep Building
Dep Equipment
Total Expenses
Net Profit
143600
76030
67570
25050
360
192
25602
19700
240
288
20228
45830
21740
27450
39850
39850
12400
Problem 3-4
Morrisville Canning
Income Statement
For the Period ended on 31st, December 19 A
Description
Amount
$
Sales
Direct Material
Opening Inventory of Raw Material
Add Purchases
$
4000
15000
$
60000
19000
2000
17000
9000
9000
35000
2000
37000
1000
36000
6000
42000
4000
38000
2000
40000
20000
6000
9000
15000
5000
Cash Account
O/B
Sales
5000 Material
60000 Labour
FOH
(9000+2000-3000)
Admn Exp
Marketing Exp
C/B
65000
Assets
Cash
15000
9000
8000
6000
8000
19000
46000
$
17500
Accounts Receivables
Finished Goods
Work in Process
Materials
Prepaid expenses
Property Plant etc
Less Depreciation
30000
10000
5000
26000
62500
62500
Problem 5
Date
a
b
c
d
e
f
g
Description
P.R
Debit($)
Material Control
Voucher Payable
6000
2500
1400
1800
FOH Control
Material Control
1700
3900
1800
1700
500
Voucher Payble
Material Control
600
Accrued Payroll
Voucher Payable
Voucher Payable
Bank
Credit($)
6000
Material Control
WIP Job 2001
FOH Control
15000
400
100
600
10000
750
1050
8200
8200
8200
8200
8200
i
60%
20%
12%
8%
3000
1800
1200
2000
1200
800
10000
(8000/10000)*1170
(1200/10000)*1170
(800/10000)*1170
936
140.4
93.6
750
340
80
1170
FOH Control
Voucher Payable
Voucerh Payable
Bank
1504
3000
1800
1200
1504
1504
1504
6000
6000
6000
400
18100
18500
18500
18100
Accounts Receivable
Sales
22500
18100
22500
8000
8000
Accounts Receivable
Sales
10000
Cash
26000
10000
Accounts Recivable
26000
100
6000
40
6140
6140
40
40
Requirement:
1 Journal Entries as above with WIP Job Nos as subsidiary Accounts
2 Prepare Individual JOB WIP Account they should be equal to WIP Control Account.
b
c
i
l
Material
c/b
34100
i
l
Payroll
Foh app
3000
3000
18500
400
33700
33700
Material
c/b
400
18100
18100
i
l
Payroll
Foh app
1800
1800
c/b
11400
Material
Payroll
Foh app
0 e
1800
1200
1200
4200
11400
11400
Material
c/b
100
4100
4100
18100
11400
4100
33600
Problem 6
Job Order cost Sheet.
Topper Inc.
Job Order Cost Sheet
Job NO 621
Direct Material Cost
1-Mar O/B
Issued
Issued
Total
Direct Labour Cost
1-Mar O/B
Total
2800
2800
2100
2100
Factory Overhead
1-Mar O/B
1680
Total
1680
6580
Topper Inc.
Job Order Cost Sheet
Job NO 622
Direct Material Cost
1-Mar O/B
Issued
Issued
Total
Direct Labour Cost
1-Mar O/B
3400
3400
2700
Total
Factory Overhead
1-Mar O/B
2700
2160
Total
2160
8260
Topper Inc.
Job Order Cost Sheet
Job NO 623
Direct Material Cost
1-Mar O/B
Issued
Issued
Total
Direct Labour Cost
1-Mar O/B
1800
1800
1350
Total
1350
Factory Overhead
1-Mar O/B
Date
a
b
d
e
1080
Total
1080
4230
Description
P.R
Debit($)
Material Control
Voucher Payable
22000
5300
7400
5900
2400
Credit($)
22000
21000
Material Control
WIP 622
FOH Control
600
Voucher Payble
Material Control
800
400
200
800
38000
Accrued Payroll
Voucher Payable
Voucher Payable
Bank
30780
2850
4370
30780
30780
8200
8200
Payroll Control
g
0.307177
0.390431
20900 0.302392
6420
8160
6320
7600
5700
3800
38000
5956.50
1191.30
794.20
2850.0
2052.0
3040.0
7942
FOH Control
Voucher Payable
Acc.Dep Factory Building
Prepaid Insurance
O/B
V. Payable
WIP 622
FOH Control
Material
WIP Job 621
14000 WIP Job 622
22000 WIP Job 623
400 FOH Control
200 V/P
C/B
36600
5500
3250
2000
250
5136
6528
5056
16720
16720
16720
5300
7400
5900
2400
800
14800
36600
Work in Process
O/B
Material Control
Payroll Control
400
53384
FOH Applied
16720
C/B
21506
53784
75290
Finished Goods
O/B
WIP
C/B
53384
15000
53384
68384
6580
5300
6420
5136
Fiinshed Goods
23436
O/B
Material Control
Payroll Control
FOH Applied
23436
23436
400
7400
8160
6528
Fiinshed Goods
30348
29948
30348
4230
5900
6320
5056
C/B
21506
21506
Finished Goods
21506
53384
Accounts Receivable
Sales
Cash
23436
29948
74737.6
74737.6
69450
Accounts Recivable
69450
2800
5300
Total
8100
2100
6420
Factory Overhead
1-Mar O/B
Current
Total
1680
5136
8520
6816
23436
9374.4
32810.4
3400
7000
10400
Current
2700
8160
Factory Overhead
1-Mar O/B
Current
Total
2160
6528
10860
8688
29948
11979.2
41927.2
1800
5900
Total
7700
1350
6320
Factory Overhead
1-Mar O/B
Current
Total
1080
5056
7670
6136
Sechdule of Inventories
Materials
Work in Process
Finished Goods
21506
14800
21506
15000
Problem 7
O/B
WIP
Finished Goods
78830 CGS
94501.65 C/B
173331.7
94501.65
78830.00
173331.65
Work in Process
O/B
Payroll Control
Material Control
FOH Applied
475895.2
94501.65
381393.50
475895.15
Material
O/B
V/Payable
V/Payable
65000 WIP
42300
5800 C/B
113100
Prepaid Insurance
Taxes Payable
Dep-Machinry
Dep-Building
FOH Control
830 O/B
845 FOH Applied
780
840
53730
59370
113100
12300
30660.15
V/Payalbe
Indirect Supplies
Pay roll control
Employer taxes
C/B
8000
1910
12480
15256.87
2018.28
42960.15
42960.15
94501.65
94501.65
94501.65
WIP Job205
O/B
Payroll Control
Material Control
FOH Applied
118060
22750
11320
7475 C/B
159605
159605
159605
124101
28920
10490
8774.5 C/B
172285.5
172285.5
172285.5
20370
22440
6693 C/B
49503
49503
Date
a
b
c
Description
P.R
Debit($)
Material Control
Voucher Payable
42300
Material Contorl
Voucher Payable
5800
26844
22750
28920
20370
12480
Payroll Contorl
7.50% FICA Tax payable
11.50% Emp Income Tax payable
81% Accrued Payroll
49503
Credit($)
42300
5800
111364
111364
8352.3
12806.86
90204.84
Accrd Payroll
Voucher Payable
90204.84
FOH Control
7.5% FICA Tax payable
5.4% State Unemp Tax payble
0.8% Fed. Unemp Tax payble
15256.87
90204.84
8352.3
6013.7
890.9
15256.87
9480
11320
10490
22440
13205
53730
830
845
780
840
8000
1910
2.3
2.3
2.3
2.3
3355.5
3250
3815
2910
30660.15
FOH Applied
FOH Control
h
7717.65
7475
8774.5
6693
30660.15
30660.15
A/R
117500
Sales
117500
O/B
204
205
206
207
Problem 8
50460
118060
124101
0
292621
94501.65
94501.65
D.MaterialD.Labour FOH
9480
11320
10490
22440
53730
Total
2018.28