QUESTION #1
Listed below are selected items for Klugman Company at December 31, 2008.
Finished goods inventory $35,000 Short-term investments $28,000
Cash 20,000 Raw materials inventory 12,000
Prepaid expenses 2,000 Work in process inventory 18,000
Accounts receivable 4,000 Supplies 500
Instructions
Prepare the current assets section of the balance sheet. (Include a complete heading.)
QUESTION #2
Finn Manufacturing Company uses a job order cost accounting system and keeps perpetual inventory records. Prepare journal entries to record the following transactions during the month of June.
June 1 Purchased raw materials for $20,000 on account.
8 Raw materials requisitioned by production:
Direct materials $8,000
Indirect materials 1,000
15 Paid factory utilities, $2,100 and repairs for factory equipment, $3,000.
25 Incurred $84,000 of factory labor.
25 Time tickets indicated the following:
Direct Labor (5,000 hrs $12 per hr) = $60,000
Indirect Labor (3,000 hrs $8 per hr) = 24,000
$84,000
QUESTION #3
Martin Co. applies manufacturing overhead based on direct labor hours. Information concerning manufacturing overhead and labor for the year are as follows:
Actual manufacturing overhead $118,000
Estimated manufacturing overhead $110,000
Direct labor hours incurred 4,800
Direct labor hours estimated 5,000
Compute the predetermined overhead rate AND the amount of applied manufacturing overhead.