Use the following information to answer questions. (Algo) [The following information applies to the questions displayed below.] Information on Kwon Manufacturing's activities for its first month of operations follows: a. Purchased $101,800 of raw materials on credit. b. Materials requisitions show the following materials used for the month. Job 201 Job 202 Total direct materials Indirect materials Total materials used $ 50,000 25,400 75,400 10,420 $ 85,820 c. Time tickets show the following labor used for the month. Job 201 $ 41,000 Job 202 14,400 Total direct labor 55,400 26,000 $ 81,400 Indirect labor Total labor used d. Applied overhead to Job 201 and to Job 202 using a predetermined overhead rate of 80% of direct materials cost. e. Transferred Job 201 to Finished Goods Inventory. f. Sold Job 201 for $169,160 on credit. g. Incurred the following actual' other overhead costs for the month. Depreciation of factory equipment Rent on factory building (payable) Factory utilities (payable) $ 33,800 680 Expired factory insurance 980 4,800 Total other factory overhead costs $ 40,260 Exercise 19-7 (Algo) Recording materials, labor, overhead, and sales LO P1, P2, P3 Prepare journal entries to record the transactions reflected in items a through g.
Use the following information to answer questions. (Algo) [The following information applies to the questions displayed below.] Information on Kwon Manufacturing's activities for its first month of operations follows: a. Purchased $101,800 of raw materials on credit. b. Materials requisitions show the following materials used for the month. Job 201 Job 202 Total direct materials Indirect materials Total materials used $ 50,000 25,400 75,400 10,420 $ 85,820 c. Time tickets show the following labor used for the month. Job 201 $ 41,000 Job 202 14,400 Total direct labor 55,400 26,000 $ 81,400 Indirect labor Total labor used d. Applied overhead to Job 201 and to Job 202 using a predetermined overhead rate of 80% of direct materials cost. e. Transferred Job 201 to Finished Goods Inventory. f. Sold Job 201 for $169,160 on credit. g. Incurred the following actual' other overhead costs for the month. Depreciation of factory equipment Rent on factory building (payable) Factory utilities (payable) $ 33,800 680 Expired factory insurance 980 4,800 Total other factory overhead costs $ 40,260 Exercise 19-7 (Algo) Recording materials, labor, overhead, and sales LO P1, P2, P3 Prepare journal entries to record the transactions reflected in items a through g.
College Accounting, Chapters 1-27
23rd Edition
ISBN:9781337794756
Author:HEINTZ, James A.
Publisher:HEINTZ, James A.
Chapter26: Manufacturing Accounting: The Job Order Cost System
Section: Chapter Questions
Problem 8SPB
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Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
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