Reference no: EM131819589

Southwest company uses a job-order costing system and applies manufacturing overhead cost to jobs on the basis of the cost of direct materials used in production. Its predetermined overhead rate was based on a cost formula that estimated $248,000 of manufacturing overhead for an estimated allocation base of $155,000 direct materials dollars. The following transactions took place during the year (all purchases and services were acquired on account):

Raw Materials purchased, $242,000

Raw materials requisitioned for use in production (all direct materials), $150,000

Utility bills incurred in the factory, $21,000

Costs for salaries and wages were incurred as follows:

Direct labor $216,000

Indirect Labor $90,000

Selling and administrative salaries $145,000

Maintenance cost incurred in the factory $15,000

Advertising costs incurred $130,000

Depreciation recorded for the year, $50,000 (90% relates to factory assets, and the remainder relates to selling and administrative assets).

Rental costs incurred on building, $90,000 (80% of the space is occupied by the factory, and 20% is occupied by sales and administration).

Miscellaneous selling and administrative costs incurred, $17,000

Manufacturing overhead costs was applied to jobs, $?????

Costs of goods manufactured for the year, $????

Sales for the year (all on account) totaled $1,000,000. These goods costs $600,000 according to their job costs sheet.

The balances in the inventory accounts at the beginning of the year were follows:

Raw Materials $18,000

Work in process $24,000

Finished Goods $35,000

Required:

Prepare a schedule of costs of goods manufactured.

Prepare a journal entry to close any balance in the Manufacturing Overhead account to Costs of Good Sold.

Prepare a schedule of costs of goods sold

Prepare an income statement for the year