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Assignments Worksheet

The document provides accounting information for the Pueblo Company and transactions that occurred in January. It lists general ledger account balances to start January and transactions during the month including materials purchased, steel issued, payroll costs, manufacturing costs incurred, cost of production completed, finished goods on hand, and customers billed. The required is to prepare journal entries for these transactions.

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21 views

Assignments Worksheet

The document provides accounting information for the Pueblo Company and transactions that occurred in January. It lists general ledger account balances to start January and transactions during the month including materials purchased, steel issued, payroll costs, manufacturing costs incurred, cost of production completed, finished goods on hand, and customers billed. The required is to prepare journal entries for these transactions.

Uploaded by

monomagicshop
Copyright
© © All Rights Reserved
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
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Cost Accounting and Control

Assignment
Cost Behavior Analysis

The management of Welcome Hotel is interested in an analysis of the fixed and variable costs in the electricity
used relative to hotel occupancy. The following data have been gathered from records of the year:

Month Electricity Cost Guest Days


Jan $ 400 1,000
Feb 500 1,500
Ma 500 2,500
Apr 700 3,000
Ma 600 2,500
Jun 800 4,500
Jul 1,000 6,500
Aug 900 6,000
Sep 900 5,500
Oct 700 3,000
No 600 2,500
De 800 3,500
$ 8,400 42,000

Required:

1 Determine the fixed and variable elements of electricity cost using each of the following methods. Round
the fixed cost to the nearest dollar and the variable rate to four decimal places.

a the methof of least squares


b the high and low points method
c a scattergraph with trend line fitted by inspection

2 Compute the coefficient of correlation, r , and the coefficient of determination, r2 , for guest days and electricity cost.

3 Compute the standard error of the estimate.

4 Compute the 90% confidence interval for electricity cost at the 2,000-guest-days capacity.
in the electricity

ethods. Round

st days and electricity cost.


The general ledger of the Pueblo Company contained the following accounts, among others,
on January 1: Finished Goods, $15,000; Work in Process, $30,000; Materials, $25,000. During
January the following transactions were completed:

a. Materials were purchased on account at a cost of $13,500.


b. Steel in the amount of $17,500 was issued from stores.
c. Requisition for indirect materials and supplies amounted to $1,800.
d. The total payroll for January amounted to $27,000, including marketing salaries of $5,000
and administrative salaries of $3,000. Labor time tickets show that $17,000 of the labor
cost was direct labor. A payroll clearing account was used.
e. Various indirect manufacturing costs totaling $ 2,508 were paid in cash.
f. Various indirect manufacturing costs totaling $8,500 were incurred on account.
g. Total factory overhead is charged to Work in Process.
h. Cost of production completed in January totaled $60,100, and finshed goods on
January 31 totaled $15,100.
i. Customers to whom shipments were made during the month were billed for $75,000.

Required: Prepare journal entries for these transactions.


Stroup Manufacturing incurred manufacturing costs totalling $110,000 in July.
Inventories were as follows (in thousands):

30-Jun 31-Jul
Finished Goods 150.00 120.00
Work in Process 80.00 90.00

Required: Calculate cost of goods sold for July.


For July, Beerton Company had cost of goods manufactured equal to $ 50,000; direct materials used, $ 16,000;
cost of goods sold, $60,000; direct labor, $24,000; purchase of materials, $ 25,000; cost of goods available
for sale, $70,000, and total factory labor, $ 29,000. Work in process was $15,000 on July 1 and $25,000 on
July 31. The company uses a single materials account for direct and indirect materials.

Required: Prepare the following:

1. A cost of goods sold statement. For brevity, show single line items for factory overhead and direct
materials used.
2. Summary journal entries to record:
(a) purchase of materials on account
(b) use of materials, including indirect materials of $2,000
© accrual of the factory payroll, including indirect labor of $5,000 (use a payroll clearing account)
(d) distribution of factory labor cost
(e) transfer of completed work to finished goods
(f) sales on account, at a markup equal to 75% of production cost
used, $ 16,000;

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