For the year ended December 31, 2022, the job cost sheets of Sandhill Company contained the

following data. Job Number Explanation Direct Materials Direct Labor Manufacturing Overhead Total
Costs 7640 Balance 1/1 $30,000 $28,800 $34,560 $93,360 Current year’s costs 36,000 43,200
51,840 131,040 7641 Balance 1/1 13,200 21,600 25,920 60,720 Current year’s costs 51,600 57,600
69,120 178,320 7642 Current year’s costs 69,600 66,000 79,200 214,800 Other data: 1. Raw
materials inventory totaled $18,000 on January 1. During the year, $168,000 of raw materials were
purchased on account. 2. Finished goods on January 1 consisted of Job No. 7638 for $104,400 and
Job No. 7639 for $110,400. 3. Job No. 7640 and Job No. 7641 were completed during the year. 4.
Job Nos. 7638, 7639, and 7641 were sold on account for $636,000. 5. Manufacturing overhead
incurred on account totaled $144,000. 6. Incurred depreciation on factory machinery $9,600. 7.
Assigned indirect materials of $16,800 and indirect labor of $21,600. (a) Prove the agreement of
Work in Process Inventory with job cost sheets pertaining to unfinished work. Post each to the T-
account in the following order: (1) beginning balance, (2) direct materials, (3) direct labor, (4)
manufacturing overhead, and (5) completed jobs.
Prepare the adjusting entry for manufacturing overhead, assuming the balance is allocated entirely to
Cost of Goods Sold. (List all debit entries before credit entries. Credit account
titles are automatically indented when amount is entered. Do not indent
manually.)
Prepare an income statement through gross profit for 2022.

sol :

Job cost
sheet

job job
7640 job7641 7642

Balance 1/1

Direct materials 30,000 13,200 43,200

Direct labor 28,800 21,600 50,400

Manufacturing
overhead 34,560 25,920 60,480

total beginning
balance 1/1 93,360 60,720 154,080

Cost added during

the year

Direct materials 36,000 51,600 69,600 157,200

Direct labor 43,200 57,600 66,000 166,800

Manufacturing
overhead 51,840 69,120 79,200 200,160

Total cost added

during the yr 131,040 178,320 214,800 524,160

total cost of jobs 224,400 239,040 214,800 678,240

only job 7642 is

uncompleted , its
balance is 214800

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 completed work (job
7640+7641) that is
224400+239040= 463,440

balance in finished
goods inventory will
equal job 7640

Work in
process
inventor
y

154,0 Complet 463,4

1-Jan Balance 80 ed work 40

Direct 157,2
materials 00

166,8
Direct labor 00

Manufacturi 200,1
ng overhead 60

214,8
31-Dec Balance 00

Work in process
balance 214,800

unfinished jobs no 7642 214,800

Account titles
and explanations Debit Credit

Manufacturing
overhead 8,160

Cost of good
ssold 8,160

(200,160 applied
- 144,000
incurred-16,800
Ind mat-21,600
ind Lab-9,600
dep)

Gross profit

Sales 636,000

less cost of goods

sold 445,680

Gross profit 190,320

Working notes:

finished goods

This study source was downloaded by 100000842702475 from CourseHero.com on 03-21-2022 01:46:03 GMT -05:00

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 beg bal 214,800

WIP 463,440 COGS 453,840

end bal 224,400

adjusted cost of
goods sold = 453840-
8160

445,680
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