Question

Starr Mfg's predetermined overhead rate is 200% of direct labor. Information on the company's produc- tion activities during September 2017 follows. a. Purchased raw materials on credit, $125,000. b. Materials requisitions record use of the following materials for the month. Problem 2-3B Source documents, jour entries, and accounts in order costing P1 P2 P3 Job 487.. $30,000 20,000 12,000 14,000 4,000 80,000 12,000 $92,000 Job 489... Job 491... Total direct materials Indirect materials Total materials used c. Paid $11,000 cash for miscellancous factory overhead costs. d. Time tickets record use of the following labor for the month. These wages are paid in cash. Job 487.... Job 488 Job 489. $ 8,000 7.000 25,000 26,000 2.000 68,000 .16,000 $84,000 Job 491 Indirect labor e. Applied overhead to Jobs 487, 489, and 490. f. Transferred Jobs 487,489, and 490 to Finished Goods.

Answer 1

2. In the books of Starr Mfg. :

Transaction / Event	Account Titles	Debit	Credit
		$	$
a.	Raw Materials Inventory	125,000
	Accounts Payable		125,000
b.	Work in Process Inventory	80,000
	Manufacturing Overhead	12,000
	Raw Materials Inventory		92,000
c.	Manufacturing Overhead	11,000
	Cash		11,000
d.	Work in Process Inventory	68,000
	Manufacturing Overhead	16,000
	Cash		84,000
e.	Work in Process Inventory	118,000
	Manufacturing Overhead		118,000
f.	Finished Goods Inventory	233,000
	Work in Process Inventory		233,000
g.	Accounts Receivable	340,000
	Sales		340,000
g.	Cost of Goods Sold	141,000
	Finished Goods Inventory		141,000
h.	Manufacturing Overhead	96,000
	Accumulated Depreciation : Building		37,000
	Accumulated Depreciation : Equipment		21,000
	Prepaid Insurance		7,000
	Property Taxes Payavble		31,000
i.	Work in Process Inventory	18,000
	Manufacturing Overhead		18,000