Question

Fairfield Company’s raw materials inventory transactions for the most recent month are summarized here:

Beginning raw materials	$	10,000
Purchases of raw materials		111,000
Raw materials issued
Materials requisition 1445		48,500	For Job 101
Materials requisition 1446		31,000	For Job 102
Materials requisition 1447		11,500	Used on multiple jobs

1. & 2. Prepare the journal entries for materials. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)

1 record the purchase of raw materials on account

2 record the issuance of raw material to production

Fairfield Company’s payroll costs for the most recent month are summarized here:

Item	Description				Total Cost
Hourly labor wages	810 hours @ $16 per hour
	200 hours for Job 101 =	$	3,200
	330 hours for Job 102 =		5,280
	280 hours for Job 103 =		4,480		$	12,960
Factory supervision						3,950
Production engineer						6,300
Factory janitorial work						1,800
Selling, general, and administrative salaries						9,700
Total payroll costs					$	34,710

1. Calculate how much of the labor costs would be added to the following accounts:

work in process inventory

manufacturing overhead

selling, general and administrative expenses

Answer 1

1) Journal entry

No	account and explanation	Debit	Credit
a	Raw material	111000
	Account payable		111000
	(to record raw material purchase)
b	Work in process	79500
	Manufacturing overhead	11500
	raw material		91000
	(To record raw material used)

2) Journal entry

No	Account and explanation	Debit	Credit
	Work in process	12960
	Manufacturing overhead	12050
	Selling, general and administrative expense	9700
	Wages payable		34710
	(To record payroll cost)