Question

The Polaris Company uses a job-order costing system. The following transactions occurred in October: a. Raw materials purchased on account, $210,000 b. Raw materials used in production, $191.000 ($152,800 direct materials and $38,200 indirect materials). c. Accrued direct labor cost of $50,000 and indirect labor cost of $21,000. d. Depreciation recorded on factory equipment, $105,000. e. Other manufacturing overhead costs accrued during October, $129,000. f. The company applies manufacturing overhead cost to production using a predetermined rate of $5 per machine-hour. A total of 76,400 machine-hours were used in October g. Jobs costing $515,000 according to their job cost sheets were completed during October and transferred to Finished Goods. h. Jobs that had cost $448,000 to complete according to their job cost sheets were shipped to customers during the month. These jobs were sold on account at 28% above cost. Requlrec: 1. Prepare journal entries to record the transactions given above. 2. Prepare T-accounts for Manufacturing Overhead and Work in Process. Post the relevant transactions from above to each account. Compute the ending balance in each account, assuming that Work in Process has a beginning balance of $34.000. Complete this question by entering your answers in the tabs below Required 1Required 2 Prepare journal entries to record the transactions given above. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet Raw materials purchased on account, $210,000. Note: Enter debits before credits. General Journal Debit Credit Record entry Clear entry View general journal Required 1 Required 2>

Answer 1

Journal entries:
S.no.	Accounts title and explanations				Debit $	Credit $
a.	Raw material Inventory				210000
	Accounts payable					210000
b.	Work in process invventory				152800
	Manufacturing overheads				38200
	Raw material inventory					191000
c.	Work in process inventory				50000
	Manufacturing overheads				21000
	Wages payable					71000
d.	Manufacturing overheads				105000
	Accumulated depreciation					105000
e.	Manufacturing overheads				129000
	Accounts payable					129000
f.	Work in process inventory				382000		(76400*5)
	Manufacturing overheads					382000
g.	Finished Goods inventory				515000
	Wwork in proces inventory					515000
h.	Cost of goods sold				448000
	Finished Goods inventory					448000
	Accounts receivable				573440
	Sales revenue (448000+28%)					573440
Req 2.
Manufacturing overheads
Raw material inventory		38,200	Work in process inv.		382,000
Wages payable		21,000	(76400 MH @ 5)
Accumulated dep		105,000
Accounts payable		129,000
			Balance		88800
Work in Process inventory
Balance		34,000	Finished Goods Inventory		515,000
Raw material inventory		152,800
Wages Payable		50,000
Manufacturing Overheads		382,000
Balance		103,800