Problem 2-4. job cost sheets and inventory accounts [lo 3, 6] renton

PROBLEM 2-4. Job Cost Sheets and Inventory Accounts [LO 36] Renton Custom Windows produces custom windows for business and residential customers who supply Renton with architectural specifications.

At the start of 2011, three jobs were in process:

Cost incurred as of 1/1/2011

Job 258

$4,500

Job 259

5,500

Job 260

3,000

Also at the start of 2011, one job was completed and awaiting shipment:

Cost incurred as of 1/1/2011

Job 257

$8,500

During 2011, the company incurred the following costs:

Direct material

$  700,000

Direct labor

  1,600,000

Manufacturing overhead

  2,100,000

At the end of 2011, two jobs were in process:

Cost incurred as of 12/31/2011

Job 345

$2,100

Job 346

5,200

In addition, four jobs were completed and awaiting shipment:

Cost incurred as of 12/31/2011

Job 341

$1,200

Job 342

3,100

Job 343

2,400

Job 344

4,500

 

Required

PROBLEM 3-2. Comprehensive Problem, One Department [LO 3, 4] Marquita Filters produces an air filter for use in jet aircraft. Parts are added at several points in the production process. In August, production began with 500 filters in Work in Process, 80 percent complete as to materials and 70 percent complete as to labor and overhead. During the month, an additional 2,700 units were started into production. Six hundred filters were in Work in Process at the end of the month, and they were 70 percent complete as to materials and 60 percent complete as to labor and overhead.

Cost Information for August

Beginning Work in Process Inventory

Cost Added in August

Direct material

$  45,000

$269,080

Direct labor

    11,000

    77,800

Manufacturing overhead

    80,000

  497,200

    Total

$136,000

$844,080

Required

·         a. Calculate the cost per equivalent unit for each of the three cost items and in total.

·         b. Calculate the cost of items completed in August and the cost of ending Work in Process inventory.

 

·         c. Reconcile the sum of the two costs in part b to the sum of beginning Work in Process and costs added in August.

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