Question

Prepare summary Journal entries to record the following transactions for a company in its first month of operations 00:52:15 a. Raw materials purchased on account, $80,000. b. Direct materials used in production, $37.000. Indirect materials used in production, $12,000 c. Pald cash for factory payroll, $35.000. Or this total, $25,000 is for direct labor and $10,000 is for indirect labor d. Pald cash for other actual overhead costs, $7.000. e. Applied overhead at the rate of 120% of direct labor cost. . Transferred cost of jobs completed to finished goods, $50,470. g. Sold jobs on account for $72,100. The jobs had a cost of $50,470. View transaction ist View joumal entry worksheet No Transaction General Journal Credit Raw materials inventory Accounts payable Debit 80,000 80,000 (1) Work in process inventory Raw materials inventory 37.000 37,000 (2) Factory overhead Raw materials inventory 12 000 12.000

Answer 1

Here are the entries for the transactions

Transaction	General Journal	Debit	Credit
a.	Raw materials inventory	80,000
	Accounts payable		80,000
b(1).	Work in process inventory	37000
	Raw materials inventory		37000
b(2).	Factory overhead	12000
	Raw materials inventory		12000
c.	Work in process inventory	25,000
	Factory overhead	10,000
	Cash		35,000
d.	Factory overhead	7000
	Cash		7000
e.	Work in process inventory [ working note]	30,00
	Factory overhead		30,00
f.	Finished goods inventory	50,470
	Work in process inventory		50,470
g(1).	Cost of goods sold	50,470
	Finished goods inventory		50,470
g(2).	Accounts receivable	72,100
	Sales		72,100

working note:

The only transaction which is a not a direct entry and requires calculation is e.

Factory overhead = 120% of direct labor cost = 2500 * 120/ 100 = 30000