Managerial Accounting
Exam 1
Smith & Co.
Balance Sheet
December 31, 2017
Assets
Cash $15,000
Accounts Receivable 22,000
Prepaid Insurance 3,000
Material Inventory 2,000
WIP inventory 2,900
FG inventory 1,200
Equipment 50,000
(Accum. Dep) (10,000)
Total Assets $86,100
Liabilities & Equity
Accounts Payable $20,000
Wages Payable 3,000
Property Taxes Payable 1,000
Common Stock 40,000
Retained Earnings 22,100
Total Liabilities & Equity $86,100
Instructions:
- Open the balances in the general ledger.
- Post the entries for job order production costs to the general ledger.
- Prepare a statement of cost of goods manufactured and cost of goods sold, an income statement and a balance sheet.
Entries for Job Order Production Costs
- Raw Materials Inventory 3,650
Accounts Payable 3,650
Acquired materials on credit for factory use.
- Work in Process Inventory 1,700
Raw Materials Inventory 1,700
To assign costs of direct materials used.
- Factory Overhead 650
Raw Materials Inventory 650
To record use of indirect materials.
- Factory Payroll 5,350
Cash (and other accounts) 5,350
To record salaries and wages of factory workers
(including various payroll liabilities)
- Work in Process Inventory 4,100
Factory Payroll 4,100
To assign cost of direct labor used.
- Factory Overhead 1,250
Factory Payroll 1,250
To record indirect labor costs as overhead.
- Factory Overhead 5,100
Cash (and other accounts) 5,100
To record factory overhead costs such as insurance,
utilities, rent, and depreciation.
- Work in Process Inventory 5,740
Factory Overhead 5,740
To apply overhead at 140% of direct labor.
- Finished Goods Inventory 8,980
Work in Process Inventory 8,980
To record completion of Jobs B15, B 16, and B17.
- Cash 10,600
Sales 10,600
Cost of Goods Sold 5,560
Finished Goods Inventory 5,560
To record sale of Jobs B15 and B16.
- What is the ending cash balance?
- $18,300
- $26,350
- $15,150
- $19,400
- What is the ending accounts receivable balance?
- $22,000
- $19,000
- $21,000
- $25,000
- What is the ending prepaid insurance balance?
- $1,000
- $2,000
- $2,500
- $3,000
- What is the ending materials inventory balance?
- $4,450
- $3,300
- $2,700
- $2,600
- What is the ending work in process balance?
- $5,200
- $4,670
- $5,150
- $5,460
- What is the ending finished goods balance?
- $4,620
- $4,950
- $5,285
- $4,900
- What is the ending equipment balance net of accumulated depreciation?
- $50,000
- $40,000
- $35,000
- $30,000
- What is the ending accounts payable balance?
- $19,600
- $21,500
- $22,850
- $23,650
- What is the ending retained earnings balance?
- $24,600
- $25,880
- $23,900
- $21,820
- What is the adjustment to factory overhead?
- $1,260 debit
- $1,260 credit
- $1,350 debit
- $1,350 credit
- What is cost of goods sold before the adjustment?
- $5,560
- $4,650
- $5,600
- $5,750
- What is cost of goods sold after the adjustment?
- $6,700
- $6,300
- $5,900
- $6,820
- What is the cost of goods manufactured?
- $9,600
- $9,100
- $8,200
- $8,980
- What is net income?
- $3,500
- $3,780
- $3,200
- $3,150
- What is total assets?
- $93,530
- $92,900
- $99,400
- $91,000
- What represents the correct order of the job order costing process?
- supplier, materials, work in process, finished goods, retail
- materials, work in process, retail, finished goods
- finished goods, materials, work in process, retail
- retail, work in process, materials, finished goods
- Which account keeps track of the costs on the assembly line?
- finished goods
- work in process
- materials
- equipment
- What are prime costs?
- direct materials + direct labor
- direct labor + overhead
- direct labor
- overhead
- What are conversion costs?
- direct materials + direct labor
- direct labor
- direct labor + overhead
- overhead
- What is the formula for cost of goods manufactured?
- BWIP + DM + DL + OH applied – EWIP
- BWIP + DM + DL + OH applied
- BWIP + DM
- DM + DL + OH