Question

Munson Co. uses a job order cost system. The following data summarize the operations related to production for July:

July 1 Materials purchased on account, $225,750
2 Materials requisitioned, $217,600, of which $17,600 was for general factory use
31 Factory labor used, $680,000, of which $72,300 was indirect.
31 Other costs incurred on account for factory overhead, $330,000; selling expenses, $180,000; and administrative expenses, $126,000
31 Prepaid expenses expired for factory overhead, $27,500; for selling expenses, $8,100; and for administrative expenses, $5,250
31 Depreciation of office building was $44,500; of office equipment, $16,800; and of factory equipment, $55,100
31 Factory overhead costs applied to jobs, $548,000
31 Jobs completed, $1,140,000
31 Cost of goods sold, $1,128,000

Required:
Journalize the entries to record the summarized operations.

Answer 1

Answer and Explanation:

The journal entries are given below:

a. Materials $225,750

To Accounts Payable $225,750

(Being material purchased on account is recorded)

b. Work in Process $200,000

Factory Overhead $17,600

Materials $217,600

(Being requisitioned of the material is recorded)

c. Work in Process $607,700

Factory Overhead $72,300

Wages Payable $680,000

(Being wages payable is recorded)

d. Factory Overhead $330,000

Selling Expenses $180,000

Administrative Expenses $126,000

Accounts Payable $636,000

(Being account payable is recorded)

e. Factory Overhead $27,500

Selling Expenses $8,100

Administrative Expenses $5,250

To Prepaid Expenses $40,850

(Being prepaid expense expired is recorded)

f. Depreciation Expense- Office Building $44,500

Depreciation Expense- Office Equipment $16,800

Factory Overhead $55,100

Accumulated Depreciation - Building & equipment $116,400

(Being the depreciation expense is recorded)

g. Work in Process $548,000

Factory Overhead $548,000

(Being work in process is recorded)

h. Finished Goods $1,140,000

Work in Process $1,140,000

(Being job completed is recorded)

i. Cost of Goods Sold $1,128,000

Finished Goods $1,128,000

(Being cost of goods sold is recorded)