CH2 Job Order Costing

Fremont Cookies has been baking coconut cookies for 27 years. Fremont makes two types of cookies, regular and
premium. Cookies are sold to other commercial businesses and premium cookies are made-to-order in batches based on
customer orders/jobs. Infomration for Fremont's premium cookies for the month of April follows:

The company allocates manufacturing overhead based on machine hours. Fremont expects to incur $175,000 of
manufacturing overhead costs, and to use 2100 machine hours during fiscal year 2024. Fremont reported the following
inventories at March 31, 2024:
Raw Materials Inventory $11,100
Work-in-Process Inventory $8,300
Finished Goods Inventory $5,900
During April 2024, Fremont actually used 176 machine hours.

Use the blue shaded areas on the ENTERANSWERS tabs for inputs.

ALWAYS use cell references and formulas where appropriate to receive full credit. If you copy/paste from the
Instructions tab you will be marked wrong. Enter all amounts as positive values. Do not use a minus sign or
parentheses for any values.

Requirements:
1 Compute the predetermined overhead allocation rate for 2024. Use the blue shaded areas for inputs.
Use Excel to journalize the transactions in the general journal. The account titles are available when you
2 click the down-arrow.
Use the Increase Indent button on the Home tab to indent items.

3 Post the transactions to T-accounts. The balances in the T-accounts are automatically updated.
Enter the beginning balances for the inventories. Assume the rest of the accounts have beginning balances of zero.
4 Adjust the manufacturing overhead account.
 a. Prepare the journal entry.
b. Post to T-accounts.
List the ending balances for Raw Materials Inventory, Work-in-Process Inventory, Finished Goods
5 Inventory, and Cost of Goods Sold.
6 Complete the Schedule of Cost of Goods Manufactured for April 2024.
7 Complete the Cost of Goods Sold schedule for April 2024.
8 Complete the Income Statement in good form for April 2024.

Excel Skills:
1 Enter numbers or text into cells.
2 Use Excel’s data validation to select account names for the journal entries.
3 Use the Increase Indent button to indent accounts to be credited for the journal entries.

Saving & Submitting Chapter Excel Assignments

1. Save file.
a. You may want to create folder on desktop, and label COMPLETED EXCEL PROJECTS
b. Name your files: CHnumber_FirstNameLastName (e.g., CH1_RobynVerdery).
2. Upload and submit your file to be graded.
a. Click on "Assessments" located on the navigation bar at the top of the page to open the dropdown menu.
b. Click on "Assignments."
c. Select the assignment for this chapter.
d. Upload your file(s).
e. Double check you uploaded the right files.
f. Submit them.

Completing Chapter Excel Quizzes

1. Click on "Assessments" located on the navigation bar at the top of the page to open the dropdown menu.
2. Click on "Exams/Quizzes."
3. Select the Quiz for this chapter.
4. Complete the Quiz.
5. Double check your answers against your Excel worksheets.
6. Submit the Quiz.
Requirement 1
Compute the predetermined overhead allocation rate for fiscal year 2024.
(Always use cell references and formulas where appropriate to receive full credit. If you copy/paste from the Instructions
tab you will be marked wrong. Enter all amounts as positive values. Do not use a minus sign or parentheses for any
values.

Predetermined
overhead = Total estimated overhead costs / Total estimated machine hours
allocation rate

$ 175,000 Total estimated overhead costs

2,100 Total estimated machine hours

$ 83 Predetermined overhead allocation rate

HINTS
Cell | Hint:

B8, B10 | Refer to the problem statement for the inputs. Do not use an equal sign (=) when entering a numeric value.
Requirement 2
Journalize the transactions in the general journal. The account titles are available when you click
the down-arrow. Use the Increase Indent button on the Home tab to indent items. (Scroll down to
view hints.)
(Always use cell references and formulas where appropriate to receive full credit. If you copy/paste
from the Instructions tab you will be marked wrong. Enter all amounts as positive values. Do not
use a minus sign or parentheses for any values.

Date Account/Explanation Debit Credit

(a) Raw Materials Inventory 15,000
Accounts Payable 15,000
Purchased materials on account, $15,000

(b) Work-in-Process Inventory 5,800

Raw Materials Inventory 5,800
Used direct materials, $5,800

(c) Work-in-Process Inventory 5,984

Manufacturing Overhead 408
Selling and Administrative Expense 408
Wages Payable 6,800
Manufacturing wages incurred totaled $6,800;
88%was direct labor, 6% was indirect labor and 6%
was selling and administrative

(d) Manufacturing Overhead 1,300

Raw Materials Inventory 1,300
Used indirect materials, $1,300

(e) Manufacturing Overhead 14,000

Accounts Payable 14,000
Incurred other manufacturing overhead on account,
$14,000

(f) Work-in-Process Inventory 14,667

Manufacturing Overhead 14,667

Allocated manufacturing overhead for April 2024.

(g) Finished Goods Inventory 27,000

Work-in-Process Inventory 27,000
$27,000 of cookies were completed during April.

(h) Sales Revenue 51,000

Finished Goods Inventory 51,000
Sold $51,000 of cookies on account.

Cost of Goods Sold 29,900

Finished Goods Inventory 29,900
The cost of the cookies sold was $29,900.

HINTS
Enter debits, then credits.
Use the values given in each transaction. Do not use an equal sign(=) when entering a numeric
value directly provided in the transaction explanation.
Cell | Hint:
C14:D16 | In the appropriate cells, begin the formula with an equal sign (=), and use the values in
the
transaction description to calculate the dollar amounts for direct and indirect labor.

C27:D28 | In the appropriate cells, begin the formula with an equal sign (=), and use the values in
the
transaction description to calculate the amount of manufacturing overhead.
Requirement 3
Post the transactions. The balances in the T-accounts are automatically updated. Enter the beginning *If these amounts do not match, you have not
balances for the inventories. Assume the rest of the accounts have beginning balances of zero (do not enter posted all of your journal entries or you have not
zero as the beginning balances). posted your journal entries correctly.
(Always use cell references and formulas where appropriate to receive full credit. If you copy/paste from the
Instructions tab you will be marked wrong. Enter all amounts as positive values. Do not use a minus sign or T-Account Debit-
parentheses for any values. Credit Check
DR CR
Accounts Receivable Accounts Payable Sales Revenue 165,467 165,467
51,000 15,000 51,000
14,000
51,000 29,000 51,000

Raw Materials Inventory Wages Payable Manufacturing Overhead

bal. 11,100 5,800 6,800 408 14,667
15,000 1,300 1,300
19,000 6,800 14,000
1,041
Work-in-Process Inventory
bal. 8,300 27,000 Cost of Goods Sold
5,800 29,900
5,984
14,667 29,900
7,751

Finished Goods Inventory Selling and Administrative Expense

bal. 5,900 29,900 408
27,000
3,000 408

HINTS
1. Enter the beginning balances and amounts of transactions by using cell references to
ENTERANSWERS2 and Instructions tabs. Make sure to use the appropriate debit or credit value.
2. Enter the amounts in order they appear on ENTERANSWERS2 tab. Some of the input cells marked in
blue may not require entries. Do not leave any blank lines between the amounts.
3. In the appropriate T-accounts, use cell references to ENTERANSWERS4 tab to post the adjusting entry
from Requirement 4.
Requirement 4
Adjust the manufacturing overhead account.
a. Prepare the journal entry.
b. Post the journal entry to the ENTERANSWERS3 tab.

Date Account/Explanation Debit Credit

(i) Cost of Goods Sold 1,041
Manufacturing Overhead 1,041
Adjusted manufacturing overhead.

Requirement 5
List the ending balances for Raw Materials Inventory, Work-in-Process Inventory, Finished Goods Inventory, and Cost of
Goods Sold.
(Always use cell references and formulas where appropriate to receive full credit. Enter all amounts as positive values. Do
not use a minus sign or parentheses for any values.)

Account Ending balance

Raw Materials Inventory 19,000
Work-in-Process Inventory 7,751
Finished Goods Inventory 3,000
Adjusted Cost of Goods Sold 30,941

HINTS
C8:C9 | In the appropriateCell | Hint:
cells, begin the formula with an equal sign (=), and use cell
references to the
ENTERANSWERS3 tab to calculate the amount of adjusting entry. Do not refer to the
ending
balance cells in your calculations.
C18:C21 | Use cell references to the ENTERANSWERS3 tab to enter the ending balances.
 Requirement 6
Complete the Schedule of Cost of Goods Manufactured.
(Always use cell references and formulas where appropriate to receive full credit. All values
should be added as positive numbers.)

Fremont Cookies - Premium Cookies Division

Schedule of Cost of Goods Manufactured
Month Ended April 30, 2024

Beginning Work-in-Process Inventory $ 8,300

Direct Materials Used $7,100
Direct Labor $5,984
Manufacturing Overhead $15,708
Total Manufacturing Costs Incurred during Period $28,792
Total Manufacturing Costs to Account For $37,092
Ending Work-in-Process Inventory -$7,751
Cost of Goods Manufactured $ 29,341

HINTS
All values other than the value for Ending Work-in-Process Inventory should be entered as positive
values. Use minus sign to enter the value for Ending Work-in-Process Inventory.
Cell | Hint:
E10, D11:D13, E16, C25 | Use the numeric values from the Instructions tab for calculations. Do not
use an equal sign (=) when entering a single numeric value.

E14 | Use the =SUM( ) function to calculate the total manufacturing costs incurred during period.
 Requirement 7: Complete the Cost of Goods Sold schedule.

Fremont Cookies - Premium Cookies Division

Schedule of Cost of Goods Sold
Month Ended April 30, 2024

Beginning Finished Goods Inventory $ 5,900

Cost of Goods Manufactured 29,341
Cost of Goods Available for Sale 35,241
Ending Finished Goods Inventory (3,000)
Cost of Goods Sold $ 32,241
Over/Under Applied Overhead (1,041)
Adjusted Cost of Goods Sold $ 31,200

Requirement 8: Complete the Income Statement.

Fremont Cookies - Premium Cookies Division

Income Statement
Month Ended April 30, 2024

Sales Revenue $ 51,000

Cost of Goods Sold 31,200
Gross Profit 19,800
Selling and Administrative Expense 408
Net Income $ 19,392

HINTS
All values should be entered as positive values where appropriate. Use minus sign to enter
valuea being deducted.
Cell | Hint:
Use the numeric values from other tabs where appropriate. Do not use an equal sign (=)
when entering a single numeric value.
Use the =SUM( ) function to calculate subtotsls or totals where appropriate.

(Always use cell references and formulas where appropriate to receive full
credit. All values should be added as positive numbers.)