Reference no: EM132611233

National Company uses a job order costing system. In May 2019, the company made a Rs. 3,300,000 bid to build a pedestrian overpass over the beach highway at Gulf Shores, Alabama. National Company won the bid and assigned job # 515 to the project. Its completion date was set at December 15, 2019. The following costs were estimated for completion of the over pass: Rs. 1,240,000 for direct material, Rs. 670,000 for direct labor, and Rs. 402,000 for overhead. During July, work began on job # 515; direct material cost assigned to job # 515 was 121,800, and direct labor associated with it was Rs. 175,040. The firm uses a predetermined overhead rate of 60% of direct labor cost.

National Company also worked on several other jobs during July and incurred the following costs:

Direct material (including Job # 515) issued                         RS. 579,300

Direct labor (including Job # 515) accrued                               584,000

Indirect labor accrued                                                           55,800

Administrative salaries and wages accrued                                 39,600

Depreciation on construction equipment                                    26,400

Depreciation on office equipment                                               7,800

Client entertainment (on accounts payable)                                11,100

Advertising for firm (Paid in cash)                                               6,600

Indirect material (from supplies inventory)                                   18,600

Miscellaneous expenses (design-related; to be paid in the following month) 10,200

Accrued utilities (for office, Rs. 1,800; for construction, Rs. 5,400)     7,200

During July, the company completed several jobs that had been in process before the beginning of the month. These completed jobs sold for Rs. 1,224,000 and payment will be made to the company in August. The related job cost sheets showed costs associated with those jobs of Rs. 829,000. At the beginning of July, the company had Work in Process Inventory of Rs. 871,800

Required:

Question a. prepare job order cost sheet for Job # 515, including all job details, and post the appropriate cost information for July.

Question b. Prepare journal entries for the preceding information.

Question c. Prepare Cost of Goods Manufactured Schedule for July.

Question d. Assuming that the company pays income tax at a 25% rate, prepare income statement