Question

Required information Problem 16-1A Production cost flow and measurement; journal entries LO P1, P2, P3, P4 [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 $ 96,000 223,500 243,300 56,100 Ending Inventory $116, 350 150, 500 116,300 14,250 The following additional information describes the company's production activities for May Direct materiala Raw materiale purchased on credit Direct materials used-Cutting Direct materials used-Stitching $115,000 26,250 Direct labor Direct laborCutting Direct labor-stitching Total factory payroll paid (in cash) $24.600 98. 400 181,600 Factory Overhead Actual costa) Indirect materials used Indirect labor used Other Overhead coats $68,400 58,600 65,000 Factory Overhead Rates Cutting (1501 of direct materials used) Stitching (1201 of direct laborused) Sales $976.000 Problem 16-1A Part 1

Answer 1

Total Factory Wages RM - Opening Stock RM - Purchases Raw Materials (RM) 96,000 RM - Indirect Use 1,15,000 RM - Cutting Use RM - Closing Stock 2,11,000 68,400 26,250 1,16,350 2,11,000 Factory Labor 1,81,600 Wages - Cutting Wages - Stitching Wages - Indirect 1,81,600 24,600 98,400 58,600 1,81,600 1,36,975 Work in Progress (Cutting) WIP (C) - Opening Stock 2,23,500 WIP (C) - COGM Factory Labor 24,600 Factory OH 39,375 WIP (C) - Closing Stock 2,87,475 RM Factory Labor Other OH Costs Factory Overheads 68,400 Factory OH - Cutting 58,600 Factory OH - Stitching 65,000 Costing P/L Account 1,92,000 39,375 1,18,080 34,545 1,92,000 1,50,500 2,87,475 ,80,455 Finished Goods 56,100 COGS 4,80,455 FG - Opening Stock WIP (S) - COGM 4,92,305 Work in Progress (Stitching) WIP (S) - Opening Stock 2,43,300 WIP (S) - COGM 4 WIP (C) - COGM 1,36,975 Factory Labor 98,400 Factory OH 1,18,080 WIP (S) - Closing Stock 5,96,755 FG - Closing Stock 1,16,300 5,96,755 44,250 5,36,555 5,36,555 Sales Cost of Goods Sold Gross Profit 9,76,000 4,92,305 4,83,695 Cost of Goods Transferred to FG Cost of Goods Sold 4,80,455 4,92,305