Unit Cost, Ending Work-in-Process Inventory, Journal Entries
During August, Skyler Company worked on three jobs. Datarelating to these three jobs follow:
| Job 39 | Job 40 | Job 41 |
| Units in each order | 60 | 100 | 80 |
| Units sold | — | 100 | — |
| Materials requisitioned | $700 | $680 | $800 |
| Direct labor hours | 360 | 400 | 200 |
| Direct labor cost | $1,980 | $2,480 | $1,240 |
Overhead is assigned on the basis of direct labor hours at arate of $2.30 per direct labor hour. During August, Jobs 39 and 40were completed and transferred to Finished Goods Inventory. Job 40was sold by the end of the month. Job 41 was the only unfinishedjob at the end of the month.
Required:
1. Calculate the per-unit cost of Jobs 39 and40. Round unit costs to nearest cent.
| Job 39 | $ per unit |
| Job 40 | $ per unit |
2. Compute the ending balance in thework-in-process inventory account.
$
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1. Manufacturing cost comes from totalingdirect materials, direct labor, and overhead on each job. The grandtotal can be divided by the number of units to determine per-unitcost.
2. Determine which jobs are still inwork-in-process and compute the balance.
3. Prepare the journal entries reflecting (a.)the completion of Jobs 39 and 40 and (b.) the sale of Job 40. Makethe entry to record the cost of Job 40 first, followed by the entryto record the revenue from its sale. The selling price is 140percent of cost.
| a. | Finished Goods | | |
| Work in Process | | |
| b (1). | Cost of Goods Sold | | |
| Finished Goods | | |
| b (2). | Accounts Receivable | | |
| Sales Revenue | | |
