Homework SourseRequired information The following information applies to th
Required information
[The following information applies to the questions displayed below.]
Widmer Watercraft’s predetermined overhead rate for the year 2017 is 200% of direct labor. Information on the company’s production activities during May 2017 follows.
Purchased raw materials on credit, $220,000.
Materials requisitions record use of the following materials for the month.
132,500
Paid $15,750 cash to a computer consultant to reprogram factory equipment.
Time tickets record use of the following labor for the month. These wages were paid in cash.
Applied overhead to Jobs 136, 138, and 139.
Transferred Jobs 136, 138, and 139 to Finished Goods.
Sold Jobs 136 and 138 on credit at a total price of $545,000.
The company incurred the following overhead costs during the month (credit Prepaid Insurance for expired factory insurance).
Applied overhead at month-end to the Work in Process Inventory account (Jobs 137 and 140) using the predetermined overhead rate of 200% of direct labor cost.
Post the journal entries for the transactions to the following T-accounts, each of which started the month with a zero balance.
| Job 136 | $ | 49,000 | |
| Job 137 | 33,500 | ||
| Job 138 | 20,200 | ||
| Job 139 | 22,800 | ||
| Job 140 | 7,000 | ||
| Total direct materials | 132,500 | ||
| Indirect materials | 21,000 | ||
| Total materials used | $ | 153,500 | |
Solution
Solution:
| Raw Material Inventory | |||
| Particulars | Debit | Particulars | Credit |
| To Accounts Payable | $220,000.00 | By Work In Process | $132,500.00 |
| By Factory overhead | $21,000.00 | ||
| By Ending balance | $66,500.00 | ||
| Total | $220,000.00 | Total | $220,000.00 |
![Required information [The following information applies to the questions displayed below.] Widmer Watercraft’s predetermined overhead rate for the year 2017 is](/WebImages/41/required-information-the-following-information-applies-to-th-1126441-1761600739-0.webp "Required information [The following information applies to the questions displayed below.] Widmer Watercraft’s predetermined overhead rate for the year 2017 is")
