12-13A Job Order Costing System
Manufacturing Corporation was started with the issuance of common stock for
$50,000. It purchased $7,000 of raw materials and worked on three job orders
during 2012 for which data follow. (Assume that all transactions are for fash
unless otherwise indicated.)
Direct Raw Direct
Materials Used Labor
1 $1,000 $2,000
2 2,000 4,000
3 3,000 2,000
Total $6,000 $8,000
overhead is applied using a predetermined rate of $0.60 per direct labor
dollar. Jobs 2 and 3 were completed during the period and Job 3 was sold for
$10,000 cash. Baucom paid $400 for selling & administrative expenses.
Actual factory overhead was $4,300.
the preceding events in a horizontal statements model. The first event for 2012
has been recorded as an example. Net
Assets Equity Rev
– Exp = Inc
NA NA NA =$50,000
NA NA –
NA = NA
Reconcile all subsidiary accounts with their respective control accounts.
Record the closing entry for over- or under applied manufacturing overhead in
the horizontal statements model, assuming that the amount is insignificant.
Prepare a schedule of cost of goods manufactured and sold, an income statement,
and a balance sheet for 2012.
d. COGM: $14,100. NI: $3,900.