Question

The following information is available for Lock-Tite Company, which produces special-order security products and uses a job order costing system. April 30 May 31 $ $44,000 9, 200 63,000 55,000 19,500 34,300 Inventories Raw materials Work in process Finished goods Activities and information for May Raw materials purchases (paid with cash) Factory payroll (paid with cash) Factory overhead Indirect materials Indirect labor Other overhead costs Sales (received in cash) Predetermined overhead rate based on direct labor cost 173,000 300,000 9,000 69,000 103,000 1,400,000 55% 1. Raw materials purchases for cash. 2. Direct materials usage. 3. Indirect materials usage. Prepare journal entries for the above transactions for the month of May. View transaction list Journal entry worksheet 2 3 Record raw material purchases for cash. Note: Enter debits before credits. Transaction General Journal Debit Credit

Answer 1

Answer: Credit Debit 173,000 173,000 153,000 Transaction General Journal Raw Materials Inventory Cash (To record Raw Materials purchases for cash) Work in Process Inventory Raw Materials Inventory (To record Direct Materials used) Factory Overhead Raw Materials Inventory (To record Indirect Materials used) 153,000 9,000 9,000 Calculation: Transaction 2: Direct Materials used = Beginning Raw Materials Inventory + Purchases - Ending Raw Materials Inventory – Indirect Materials used Direct Materials used = $44,000 + $ 173,000 - $55,000 - $9,000 Direct Materials used = $153,000