Banzai Corporation produces calculators on an assembly line in a single-step process. Factrory overhead is applied based on direct labor cost. The following data pertains to September 2016:
Current manufacturing costs:
Required:
a. Prepare traditional journal entries for the following events in September:
1. Purchase of materials on account
2. Requisition of materials into production
3. Usage of direct labor
4. Application of overhead
5. Completion of finished goods
b. What is the amount of direct labor in ending work in process?
a. Prepare traditional journal entries for the following events in September:
Definitions:
Fixed Price
A contract method where the service or product is provided at a set price, regardless of the actual costs incurred.
Inflation Adjusted Price
A price that has been modified to reflect the changes in purchasing power due to inflation, allowing for comparison over time.
Cost Plus Contract
A type of contract where the buyer agrees to pay the seller all project costs, plus an additional amount or percentage as profit.
Allowable Expenses
Costs that are recognized under the provisions of a contract or agreement as reimbursable or claimable.
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