Job costing, journal entries. Donnell Transport assembles prestige manufactured homes. Its job costing system has two direct cost categories (direct materials and direct manufacturing labor) and one indirect cost pool (manufacturing overhead allocated at a budgeted $30 per machine hour in 2011). The following data (in millions) pertain to operations for 2011:
|
Materials Control, beginning balance, January 1, 2011 |
$ 12 |
|
Work in Process Control, beginning balance, January 1, 2011 |
2 |
|
Finished Goods Control, beginning balance, January 1, 2011 |
6 |
|
Materials and supplies purchased on credit |
150 |
|
Direct materials used |
145 |
|
Indirect materials (supplies) issued to various production departments |
10 |
|
Direct manufacturing labor |
90 |
|
Indirect manufacturing labor incurred by various production departments |
30 |
|
Depreciation on plant and manufacturing equipment |
19 |
|
Miscellaneous manufacturing overhead incurred (ordinarily would be detailed as repairs, utilities, |
9 |
|
etc., with a corresponding credit to various liability accounts) |
|
|
Manufacturing overhead allocated, 2,100,000 actual machine hours |
? |
|
Cost of goods manufactured |
294 |
|
Revenues |
400 |
|
Cost of goods sold |
292 |
1. Prepare an overview diagram of Donnell Transport’s job costing system. Required
2. Prepare journal entries. Number your entries. Explanations for each entry may be omitted. Post to T accounts. What is the ending balance of Work in Process Control?
3. Show the journal entry for disposing of under or over allocated manufacturing overhead directly as a year end write off to Cost of Goods Sold. Post the entry to T accounts.