Question

1. Purchased raw materials on account $49,400.

2. Raw Materials of $41,300 were requisitioned to the factory. An analysis of the materials requisition slips indicated that $8,000 was classified as indirect materials.
3. Factory labor costs incurred were $65,200.
4. Time tickets indicated that $54,600 was direct labor and $10,600 was indirect labor.
5. Manufacturing overhead costs incurred on account were $84,900.
6. Manufacturing overhead was applied at the rate of 150% of direct labor cost.
7. Goods costing $96,300 were completed and transferred to finished goods.
8. Finished goods costing $80,700 to manufacture were sold.

Required:
Record the transactions.

Answer 1

Answer and Explanation:

The journal entries are shown below:

1. Raw material inventory A/c Dr.$49,400

To accounts payable $49,400

(To record raw material purchased)

2. Work in process inventory A/c Dr. $33,300

Manufacturing overhead A/c Dr. $8,000

To Raw material inventory Cr. $41,300

(To record the raw material requisitioned is recorded)

3. Factory payroll A/c Dr.$65,200

To cash $65,200

(To record factory labor cost incurred)

4. . Work in process inventory A/c Dr. $54,600

Manufacturing overhead A/c Dr. $10,600

To factory payroll Cr. $65,200

(To record the direct labor and indirect labor is recorded)

5. Manufacturing overhead A/c Dr. $84,900

To accounts payable Cr. $84,900

(To record the manufacturing overhead is recorded)

7. Work in process inventory A/c Dr. $81,900 ($54,600×150%)

To Manufacturing overhead Cr. $81,900

(To record the applied manufacturing overhead is recorded)

8. Finished goods inventory A/c Dr. $96,300

To Work in process inventory Cr. $96,300

(To record the transferred goods are recorded)

9. Cost of goods sold A/c Dr. $80,700

To finished goods inventory Cr. $80,700

(To record the cost of goods sold is recorded)