Job order costing

ACG 2071 Managerial Accounting

Job Order Costing Systems

Minicase

JOB ORDER COSTING: Radical Jets produces and sells custom built jets for corporate and personal use. The following information was found in the general ledger:

Account Beginning Balance

Materials inventory $50,000

Goods in process $200,000

Finished Goods $325,000

• Current jobs:

Job No. Direct Materials

Direct Labor Factory Overhead

Total Costs

2145 $9,000 $12,000

2146 $8,000 $10,000

2147 $7,500 $9,000

2148 $6,000 $7,500

2150 $5,000 $7,000 Indirect $4,300 $3,600 Totals Factory overhead is applied based on direct labor costs. The company estimates that factory overhead is $136,500.

• Required:

1. Record the entry for the purchase of $34,000 in materials on account. 2. Record the entry for the requisition of materials 3. Record the entry for labor 4. Record the application of factory overhead 5. Record the completion of jobs: 2145, 2146, and 2147. 6. Record the sale of job 2145 for $50,000. 7. What are the ending balances for the three inventory accounts?

Use excel to complete the work. Template attached.