MA1 Assignment 1

Required
a. What is the manufacturing overhead application rate (predetermined overhead rate)? Show calculations. (½ mark)
b. Using the data provided, post the transactions that took place for the last week of the year to the ledgers and to the appropriate job cost sheets. show the activity in the job cost sheets and the following accounts (before any adjusting entries for over- or underapplied overhead):

Raw materials
Work in progress
Finished goods
Cost of goods sold
Manufacturing overhead
Selling and administrative expenses
Sales

International Beans, Inc. ACCOUNT: Raw Materials Description Debit Credit Balance
Beginning 63,000 DR
Jan-Dec Raw materials purchased 7,245,000 7,308,000 DR
Jan-Dec Indirect material issued to production 110,200 7,197,800 DR
Jan-Dec Direct materials issued to production 7,092,700 105,100 DR Dec 23 Direct materials issued to production 37,000 68,100 DR Dec 28 Indirect material issued to production 1,800 66,300 DR Dec 28 Direct materials issued to production 4,000 62,300 DR

ACCOUNT: Work in Process Description Debit Credit Balance
Beginning 63,870 DR
Jan-Dec Direct labour 525,300 589,170 DR
Jan-Dec Overhead applied 2,592,000 3,181,170 DR
Jan-Dec Direct materials 7,092,700 10,273,870 DR
Jan-Dec Transferred to finished goods 10,180,000 93,870 DR Dec 23 Direct materials 37,000 130,870 DR Dec 27 Direct Labour 7,170 138,040 DR
Dec 28 Overhead applied 14,958 152,998 DR
Dec 28 Transferred to finished goods 41,903 111,095 DR Dec 28 Direct