Acc346 Managerial Accounting: Week 2 Homework (P2-4, P3-2)

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Acc346 Managerial Accounting
Week 2 Homework (P2-4, P3-2)

PROBLEM 2-4. Job Cost Sheets and Inventory Accounts
Renton Custom Windows produces custom windows for business and residential customers who supply Renton with architectural specifications.
At the start of 2011, three jobs were in process:
Cost incurred as of 1/1/2011
Job 258 4,500
Job 259 5,500
Job 260 3,000

Also at the start of 2011, one job was completed and awaiting shipment:
Cost incurred as of 1/1/2011
Job 257 8,500

During 2011, the company incurred the following costs:
Direct material 700,000
Direct labor 1,600,000
Manufacturing overhead 2,100,000

At the end of 2011, two jobs were in process:
Cost incurred as of 12/31/2011
Job 345 2,100
Job 346 5,200

In addition, four jobs were completed and awaiting shipment:
Cost incurred as of 12/31/2011
Job 341 1,200
Job 342 3,100
Job 343 2,400
Job 344 4,500

Required
a. What are the beginning and ending balances in Work in Process?
b. What are the beginning and ending balances in Finished Goods?
c. What is Cost of Goods Sold? What job numbers likely relate to the balance in Cost of Goods Sold?

PROBLEM 3-2. Comprehensive Problem, One Department
Marquita Filters produces an air filter for use in jet aircraft. Parts are added at several points in the production process. In August, production began with 500 filters in Work in Process, 80 percent complete as to materials and 70 percent complete as to labor and overhead. During the month, an additional 2,700 units were started into production. Six hundred filters were in Work in Process at the end of the month, and they were 70 percent complete as to materials and 60 percent complete as to labor and overhead.
Cost Information for August Beginning Work in Process Inventory Cost Added in August
Direct material 45,000 269,080
Direct labor 11,000 77,800
Manufacturing overhead 80,000 497,200
Total $136,000 $844,080

Required
a. Calculate the cost per equivalent unit for each of the three cost items and in total.
b. Calculate the cost of items completed in August and the cost of ending Work in Process inventory
c. Reconcile the sum of the two costs in part b to the sum of beginning Work in Process and costs added in August.
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