Question

prepare the journal entries for the following transactions: 1. raw materials purchased on account, $95,000. 2. raw materials were used in production (direct materials, $74,000; indirect materials, $6,000). 3. accrued wages (direct labor, $108,000; indirect labor, $65,000) 4. manufacturing overhead was applied to jobs, $220,000. 5. other manufacturing overhead costs incurred on account: utility bills in the factory, $32,000; maintenance costs in factory, $26,000; depreciation on factory equipment, $84,250; rent on factory, $110,500 6. prepare the journal entry to close the manufacturing overhead account.

Answer 1

Journal entries for the transactions listed include debiting and crediting accounts such as Raw Materials, Work in Process, Manufacturing Overhead, Wages Payable, Accounts Payable, and others.

Step-by-step explanation:

To answer your queries on journal entries for the provided transactions, here are the entries in accordance with Generally Accepted Accounting Principles (GAAP):

1. Raw materials purchased on account:
   Debit Raw Materials $95,000
   Credit Accounts Payable $95,000
2. Raw materials used in production:
   Debit Work in Process (Direct Materials) $74,000
   Debit Manufacturing Overhead (Indirect Materials) $6,000
   Credit Raw Materials $80,000
3. Accrued wages for direct and indirect labor:
   Debit Work in Process (Direct Labor) $108,000
   Debit Manufacturing Overhead (Indirect Labor) $65,000
   Credit Wages Payable $173,000
4. Manufacturing overhead was applied to jobs:
   Debit Work in Process $220,000
   Credit Manufacturing Overhead $220,000
5. Other manufacturing overhead costs incurred in the production:
   Debit Manufacturing Overhead for the total amount of $252,750 (sum of utility bills, maintenance costs, depreciation, and rent)
   Credit Accounts Payable $68,000 (utility + maintenance)
   Credit Accumulated Depreciation $84,250
   Credit Rent Payable $110,500

To close the manufacturing overhead account, determine if there was an over or under-applied overhead for the period and adjust cost of goods sold accordingly. This question does not provide the actual applied overhead details, so this entry cannot be completed without that information.