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Sinatra Industries Inc. uses a job order cost system. The following data summarize the operations related to production for January 2014, the first month of operations:
a. Materials purchased on account, $ 39,300.
b. Materials requisitioned and factory labor used:
Sinatra Industries Inc. uses a job order cost system. The
c. Factory overhead costs incurred on account, $ 7,500.
d. Depreciation of machinery and equipment, $ 2,640.
e. The factory overhead rate is $ 60 per machine hour. Machine hours used:
Job Machine Hours
201 ........ 31
202 ........ 46
203 ........ 36
204 ........ 96
205 ........ 48
206 ........ 31
Total ........ 288
f. Jobs completed: 201, 202, 203 and 205.
g. Jobs were shipped and customers were billed as follows: Job 201, $ 11,000; Job 202, $ 14,820; Job 203, $ 19,920.
Instructions
1. Journalize the entries to record the summarized operations.
2. Post the appropriate entries to T accounts for Work in Process and Finished Goods, using the identifying letters as transaction codes. Insert memo account balances as of the end of the month.
3. Prepare a schedule of unfinished jobs to support the balance in the work in process account.
4. Prepare a schedule of completed jobs on hand to support the balance in the finished goodsaccount.
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