Robolane Incorporated Manufactures and Distributes Small Robotic Toys

question 56

Essay

Robolane Incorporated manufactures and distributes small robotic toys. Because most of its orders are via telephone or fax, numerous orders have to be reworked. The average cost of the reworked orders is $12.45: $5 for labor, $5.15 for more materials, and $2.30 for overhead. This ratio of costs holds for the average original order. On a recent day, the shop reworked 80 orders out of 800. The original cost of the 80 orders totaled $2,000. The average cost of all orders is $26.245, including rework, with an average selling price of $35.
Required:
Prepare the necessary journal entry to record the rework for the day if the shop charges such activities to Robo Department Overhead Control. Prepare journal entries to record all relevant rework charges as well as to transfer the reworked items finished goods to Finished Goods Inventory.

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Definitions:

Happens By Chance

Events or occurrences that take place without predictability or planned intention.

Predestined

Determined in advance by destiny or divine will, leading to the belief that events are fixed and unchangeable.

Stoics

Followers of Stoicism, an ancient Greek school of philosophy that teaches the development of self-control and fortitude as a means of overcoming destructive emotions.

Death

The cessation of all biological functions that sustain a living organism, marking the end of life.