CSUKid03
Feb 25, 2009, 02:41 PM
I am having problems setting up the correct journal entries to be placed in a General Ledger.
Can you help point out how to attack this problem. It's about Job Costing and it seems simple enough but for some reason I can't figure it out.
Thank you, Jackie.
*************************************************
Here is the problem as it was given to me:
At the beginning of September, Lambeth Custom Cabinets had no outstanding debts and the folowing amounts were on the books:
1. Raw Materials inventory, $2,150
2. Supplies inventory, $620
3. Work in Process (WIP) inventory, $ 5,650
Job Materials Labor Overhead(50% of Labor)
------------------------------------------------------------------------------------------------------
A-3 $ 750 $1100 $550
A-4 $ 900 $ 650 $325
A-5 $ 325 $ 700 $350
------------------------------------------------------------------------------------------------------
TOTAL $ 1975 $ 2450 $1225 $5650
=========================================================
4. All other Assets as of September 1 were $16,890.
During the month, jobs A-3, A-4, and A-6 were finished. Job A-5 did not finish and job A-7 was started but not finished in the month of September. Overhead costs(equipment, shop depreciation, cleaning supplies, and insurance) are applied to every job at the end of the month unless the job is finished during the month, in which case overhead is applied when the job is finished.
During September, the following Direct Materials and Direct Labor costs were incurred:
JOB Direct Direct
Materials Labor
-----------------------------------------------------------------
A-3 $280 $ 750
A-4 $350 $1300
A-5 $180 $ 550
A-6 $375 $ 490
A-7 $590 $ 370
-------- ---------
$1775 $ 3460
Other Financial factors of importance pertaining to September were:
a. $1,675 of Raw Materials were purchased during the month.
b. Supplies of $580 were purchased while $490 were used and thus transferred to the manufacturing overhead account.
c. Total increases to the labor general ledger account were $5,460. (Apparently there was $2,000 indirect labor charged)
d. General and Administrative expenses for the month were $3,420.
e. Collections received from customers on jobs A-3,A-4, and A-6 amounted to $,6,125, $8,600, and $1,750, respectively, for a total of $16,475.
f. At the end of the month, Lambeth Cabinets had no outstanding debts.
Here are the questions:
1. Prepare the journal entries for September.
2. Record the beginning balances in the General Ledger. Post the September transaction from question #1 into the General Ledger.
Can you help point out how to attack this problem. It's about Job Costing and it seems simple enough but for some reason I can't figure it out.
Thank you, Jackie.
*************************************************
Here is the problem as it was given to me:
At the beginning of September, Lambeth Custom Cabinets had no outstanding debts and the folowing amounts were on the books:
1. Raw Materials inventory, $2,150
2. Supplies inventory, $620
3. Work in Process (WIP) inventory, $ 5,650
Job Materials Labor Overhead(50% of Labor)
------------------------------------------------------------------------------------------------------
A-3 $ 750 $1100 $550
A-4 $ 900 $ 650 $325
A-5 $ 325 $ 700 $350
------------------------------------------------------------------------------------------------------
TOTAL $ 1975 $ 2450 $1225 $5650
=========================================================
4. All other Assets as of September 1 were $16,890.
During the month, jobs A-3, A-4, and A-6 were finished. Job A-5 did not finish and job A-7 was started but not finished in the month of September. Overhead costs(equipment, shop depreciation, cleaning supplies, and insurance) are applied to every job at the end of the month unless the job is finished during the month, in which case overhead is applied when the job is finished.
During September, the following Direct Materials and Direct Labor costs were incurred:
JOB Direct Direct
Materials Labor
-----------------------------------------------------------------
A-3 $280 $ 750
A-4 $350 $1300
A-5 $180 $ 550
A-6 $375 $ 490
A-7 $590 $ 370
-------- ---------
$1775 $ 3460
Other Financial factors of importance pertaining to September were:
a. $1,675 of Raw Materials were purchased during the month.
b. Supplies of $580 were purchased while $490 were used and thus transferred to the manufacturing overhead account.
c. Total increases to the labor general ledger account were $5,460. (Apparently there was $2,000 indirect labor charged)
d. General and Administrative expenses for the month were $3,420.
e. Collections received from customers on jobs A-3,A-4, and A-6 amounted to $,6,125, $8,600, and $1,750, respectively, for a total of $16,475.
f. At the end of the month, Lambeth Cabinets had no outstanding debts.
Here are the questions:
1. Prepare the journal entries for September.
2. Record the beginning balances in the General Ledger. Post the September transaction from question #1 into the General Ledger.