Macro Company shows the following costs for three jobs worked on in April
Job 306
Job 307
Job 308
Direct materials used (in March)
29,000
35,000
Direct labor used (in March)
20,000
18,000
Overhead applied (March)
10,000
9,000
Costs during April
Direct materials used
135,000
220,000
100,000
Direct labor used
85,000
150,000
105,00
Status on April 30
Finished (sold)
Finished (sold)
in process
Additional information:
a. Raw materials inventory has a March 31 balance of $80,000
b. Raw materials purchases in April are $500,000, and total factory payroll cost in April is $363,000
c. Actual overhead costs incurred in April are indirect materials, $50,000; indirect labor $23,000; factory rent $32,000; factory utilities, $19,000; and factory equipment depreciation $51,000
d. Predetermined overhead rat is 50% of direct labor cost
e. Job 306 is sold for $635, 000 cash in April
Required
1. Determine the amount of overhead applied to each job in April
2. Determine the total cost assigned to each job as of April 30 (including balances from March 31)
3. Prepare journal entries for the month of April to record the following
a. Materials purchases (on credit)
b. Direct materials used
c. Direct labor used (and paid in cash) and assigned to Work in process inventory
d. Indirect materials used and assigned to factory overhead
e. Indirect labor used (and paid in cash) and assigned to factory overhead
f. Overhead costs applied to Work in process inventory
g. Actual other overhead costs incurred (Factory rent and utilities are paid in cash)
h. Transfer of Jobs 306 and 307 to Finished goods inventory
I. Cost of goods sold for Job 306
j. Revenue from the sale of Job 306 received in cash
k. Close underapplied or overapplied overhead to the cost of goods sold account
4. Prepare a schedule of cost of goods manufactured
5. Compute gross profit for April. Show how the three inventory accounts are reported on the April 30 balance sheet.