Question

Acct 202... idk what the other boxes are, help me fill them with explanations to how you got the answers!

Required Information [The following information applies to the questions displayed below) Sierra Company manufactures soccer balls in two sequential processes: Cutting and Stitching. All direct materials enter production at the beginning of the Cutting process. The following information is available regarding its May inventories: Raw materials inventory Work in process inventory-Cutting Work in process inventory-Stitching Finished goods inventory Beginning Inventory $ 6,800 43,500 63,300 20, 100 Ending Inventory $ 9,250 51,500 60,5ee 8,25e The following additional information describes the company's production activities for May. Direct materials Raw materials purchased on credit Direct materials used-Cutting Direct materials used-stitching $ 25,000 21,75e Direct labor Direct labor-Cutting Direct labor-stitching Total factory payroll paid (in cash) $15.600 62,400 133,000 $ Factory Overhead (Actual costs) Indirect materials used Indirect labor used Other overhead costs head costs 6,000 55,000 47,000 Factory Overhead Rates Cutting (150% of direct materials used) Stitching (120% of direct labor used) Sales $256,000 Required: 1. Compute the amount of (a) production costs transferred from Cutting to Stitching. (b) production costs transferred from Stitching to finished goods, and (c) cost of goods sold. Ignore any over- or under-applied overhead in the calculation of cost of goods sold.

Answer 1

	Raw Material					Work In Progess - Cutting
	RM - April 30 (opening Balance)	6000	WIP- Cutting (RM used in cutting)[N.1]	21750		WIP - April 30 (opening Balance)	43500	WIP- Stitching [N.2]	61975
	RM Purchased	25000	RM - May 31 (Closing Balance)	9250		RM used [N.1]	21750
						Direct Labour-Cutting (DL used in cutting)	15600	WIP - May 31	51500
		31000		31000		Factory Overhead [N.3]	32625
							113475		113475
	Work In Progess - Stitching
	WIP-April 30	63300	Finished goods [N.5]	202055		Factory Wages Payable
	Direct Labour-Stitching (DL used in Stitching)	62400	WIP - May 31	60500		Cash	108000	Indirect Material Used	6000
	Factory Overhead [N.4]	74880						Indirect Labour Used	55000
	WIP - Cutting	61975						Other Overhead Costs	47000
		262555		262555			108000		108000
	Factory Overhead					Finished Goods
	Indirect Material Used	6000	WIP -Cutting [N.3]	32625		FG-April 30	20100	To Cost of Goods sold	213905
	Indirect Labour Used	55000	WIP -Stitching [N.4]	74880		WIP - Stitching	202055
	Other Overhead Cost	47000	Under applied Overhead (to be transferred to COGS/Income Statement) [N.5]	495				FG-May 31	8250
		108000		108000			222155		222155
	Income Statement
	Sales	256000
	Less: Cost of goods sold	213905
	Less: Underapplied Overhead [N.5]	495
		41600
N.1	Raw Material worth $21750 has been charged to the Work-In Progress - Cutting account
N.2	The Residual Balance at WIP-Cutting account ($113475-$51500 = $61795) has been charged to WIP -stitching
N.3	Factory Overhead amounting to 150% of $21750 (RM) = $36625 has been charged to WIP - Cutting Account
N.4	Factory Overhead amounting to 120% of $64200 (DL) = $74880 has been charged to WIP - Cutting Account
N.5	The Residual balance been factory Overhead incurred and factory overhead applied to WIP ($108000-$36625-$74880)=$495 has been regarded as under applied factory overhead