system DATA Targon Inc manufactures lawn equipment A joborde

system DATA: Targon, Inc., manufactures lawn equipment. A job-order costing is used, since the products are manufactured in batches rather than on a continuous basis. The company started operations on January 1, 2016. Operating activities during the first 11 months of the year (through November 30) resulted in the following balances in selected accounts: RAW MATERIALS Dr. Cr. Balance 11/30/2016 36,000 MANUFACTURING OVERHEAD Dr. Cr. 2,260,000 Balance 12/31/2016? WORK IN PROCESS Dr. Cr. Balance 11/30/2016 1,210,000

Solution

Schedules to report manufacturing cost to management:
We can develop two schedules first will be work in progress and the second one will be finished goods inventory schedule:
Let us start with Work in progress schedule:

Estate

Economy

Deluxe

Brass

Rainmaker

Connectors

Ring

Work in Process, Beginning

         710,000

         490,000

Add:

Direct Material

         210,000

            6,000

          92,000

         181,000

         163,000

Direct Labor

          62,000

          26,000

            5,000

         182,000

          52,000

Manufacturing Overhead

          36,000

          15,000

            3,000

         108,000

          30,000

Total Cost to Account For

      1,018,000

         537,000

         100,000

                   -

         471,000

                   -

         245,000

Total Goods Transferred to FGI

      1,018,000

         537,000

         471,000

         245,000

Work in Process, Ending

100,000

Number Goods Transferred

          50,000

          40,000

          30,000

          50,000

Unit Cost

$        20.360

$        13.425

$        15.700

$         4.900

Finished goods inventory:

Inventory

Sold Under LIFO

Remaining Units

No. of Units

Unit Cost

No. of Units

Unit Cost

No. of Units

Unit Cost

Total Cost

Estate

Beginning Balance

           5,000

$        22.00

           5,000

$        22.00

$    110,000.00

Goods Transferred

         50,000

$        20.36

         16,000

$        20.36

         34,000

$        20.36

$    692,240.00

$    802,240.00

Deluxe

Beginning Balance

        115,000

$        17.00

         32,000

$        17.00

         83,000

$        17.00

$ 1,411,000.00

Goods Transferred

Brass

Beginning Balance

         10,000

$        14.00

           5,000

$        14.00

           5,000

$        14.00

$      70,000.00

Goods Transferred

Rainmaker

Beginning Balance

           5,000

$        16.00

           5,000

$        16.00

$      80,000.00

Goods Transferred

         30,000

$        15.70

         10,000

$        15.70

         20,000

$        15.70

$    314,000.00

$    394,000.00

Connectors

Beginning Balance

        100,000

$          5.00

         26,000

$          5.00

         74,000

$          5.00

$    370,000.00

Goods Transferred

Economy

Beginning Balance

Goods Transferred

         40,000

$        13.43

         20,000

$        13.43

         20,000

$        13.43

$    268,500.00

Ring

Beginning Balance

Goods Transferred

         50,000

$          4.90

         22,000

$          4.90

         28,000

$          4.90

$    137,200.00

Therefore, Balance of finished goods inventory as on December 31 (by using LIFO)

Estate

$   802,240.00

Economy

$   268,500.00

Deluxe

$1,411,000.00

Brass

$    70,000.00

Rainmaker

$   394,000.00

Connectors

$   370,000.00

Ring

$   137,200.00

			Estate	Economy	Deluxe	Brass	Rainmaker	Connectors	Ring
Work in Process, Beginning	710,000	490,000
Add:	Direct Material	210,000	6,000	92,000		181,000		163,000
	Direct Labor	62,000	26,000	5,000		182,000		52,000
	Manufacturing Overhead	36,000	15,000	3,000		108,000		30,000
Total Cost to Account For	1,018,000	537,000	100,000	-	471,000	-	245,000
Total Goods Transferred to FGI	1,018,000	537,000			471,000		245,000
Work in Process, Ending			100,000
Number Goods Transferred	50,000	40,000			30,000		50,000
Unit Cost		$        20.360	$        13.425			$        15.700		$         4.900