Scenario: Just4U Company uses a job order cost system. The following data summarize the operations related to production for the month of January 20xx.
a) Materials purchased on account: $150,000
b) Materials requisitioned and Factory labor used:
|
JOB ORDER
|
MATERIALS
|
LABOR
|
|
601
|
$32,400
|
$19,300
|
|
602
|
$21,300
|
$15,200
|
|
603
|
$28,400
|
$17,500
|
|
604
|
$26,308
|
$16,395
|
|
605
|
$31,225
|
$18,422
|
|
General Factory Use
|
$5,300
|
$32,400
|
c) Factory overhead costs incurred on account: $34,500
d) Depreciation of machinery and equipment: $5,100
e) The factory overhead rate is $50 per machine hour.
|
Job Order
|
Machine Hours Used
|
|
601
|
320
|
|
602
|
225
|
|
603
|
300
|
|
604
|
285
|
|
605
|
312
|
f) Jobs completed: #601, #603, #605
g) Jobs shipped and billed: #601: $113,200, #605: $88,350
Task: Prepare the proper t-accounts and show all balances and DETERMINE GROSS PROFIT.