Question

jurvin enterprises is a manufacturing company with no beginning inventories. a subset of the transactions it recorded during a recent month is shown below.

a. purchased $94,000 in raw materials for cash.
b. $89,000 in raw materials were used in production. of this amount, $78,000 was direct materials and the remainder was indirect materials.
c. paid employees $132,000 cash. of this amount, $112,000 was direct labor and the remainder was indirect labor.
d. paid $143,000 for additional manufacturing overhead costs.
e. applied manufacturing overhead of $152,000 to production using the companys predetermined overhead rate.
f. all of the jobs in process at the end of the month were completed.
g. all of the completed jobs were shipped to customers.
h. any underapplied or overapplied overhead was closed to cost of goods sold.

required:

1. post the above transactions to t-accounts.
2. calculate the adjusted cost of goods sold for the period.

Explanation:

Post transactions to T-accounts

Using the T-Account Analysis and Cost Flow Analysis knowledge points

$$
LATEXBLOCK0
$$

Calculate adjusted cost of goods sold

Using the Manufacturing Overhead T-Account and Work in Process T-Account knowledge points

$$
LATEXBLOCK1
$$

Answer:

Question 1

The T-accounts are posted as shown in the image:

• Cash: Ending balance of \(369,000\) on the Credit side.
• Raw Materials: Ending balance of \(5,000\) on the Debit side.
• Work in Process: Ending balance of \(52,000\) on the Debit side.
• Finished Goods: Ending balance of \(0\) on the Debit side.
• Manufacturing Overhead: Underapplied balance of \(2,000\) on the Debit side before closing.
• Cost of Goods Sold: Unadjusted balance of \(290,000\) on the Debit side, with a credit of \(2,000\) from closing overhead, resulting in an ending balance of \(288,000\) on the Debit side (if closed directly) or \(292,000\) if adjusted for underapplied overhead.

Question 2

The adjusted cost of goods sold for the period is \(292,000\).