Question 1) 1. Purchased $50,000 of raw materials on account. Incurred $45,000 of factory labor. (credit factory wages payable 3.

Question 1)

1.      Purchased $50,000 of raw materials on account.

2.      Incurred $45,000 of factory labor. (credit factory wages payable

3.      Incurred $60,000 of manufacturing overhead on credit

4.      Requisitioned materials for cutting $20,000 and assembly $8,000

5.      Used factory labor for cutting $35,000 and assembly $25,000

6.      Applied overhead at the rate of $15 per machine hour. Machine hours were cutting 2,000 and assembly $80,000

7.      Transferred goods costing $50,600 from the cutting department to the assembly department

8.       Transferred goods costing $120,000 from assembly to finished goods

9.      Sold goods costing $140,000 for $170,000 on account.

Journalize transactions

Question 2)

Alpha Corporation is projecting a cash balance of $40,000 in its December 31, 2009, balance sheet. Alpha’s schedule of expected collections from customers for the first quarter of 2010 shows total collections of $200,000. The schedule of expected payments for direct materials for the first quarter of 2010 shows total payments of $50,000. Other information gathered for the first quarter of 2010 is: sale of equipment $8,000; direct labor $70,000, manufacturing overhead $30,000, selling and administrative expenses $50,000; and purchase of securities $15,000. Alpha wants to maintain a balance of at least $45,000 cash at the end of each quarter.

Complete a Cash Budget

Question 3)

Alpha company estimates that annual manufacturing overhead costs will be $900,000. Estimated annual operating activity bases are: direct labor cost $450,000, direct labor hours 300,000, and machine hours 100,000.

a)     Compute the predetermined overhead rate for each activity base.

b)     If Job 101 has 60,000 direct labor hours, compute the manufacturing overhead that it should be assigned using the predetermined overhead rate computed in question a. above.

c)      If Job 102 has 25,000 machine hours, compute the manufacturing overhead that it should be assigned using the predetermined overhead rate computed in question a. above.

Question 4)

Blake Johnson has the following cost and production data for the Mixing Department for December 2013.

Cost data:

Beginning work in process inventory, December 1

               Direct Materials

$30,000

               Conversation Cost

6,000

$36,000

Cost incurred during production in December

               Direct materials

390,000

               Conversion cost

122,000

               Total cost

$548,000

Production data

               Completed and transferred out 52,000

               Ending work in process 8,000

Ending work in process was 100% complete as to materials and 25% complete as to conversion cost

Instructions

a)     Compute the equivalent units of production

b)     Determine the unit cost for materials and conversion