Question

Journal Entries Paulson Manufacturing Company uses the perpetual inventory system to account for its manufacturing inventories. The following are Paulson's transactions during July 2016 July 5 Received material costing $5,000 from a supplier. The material was purchased on account. 9 Requisitioned $15,000 of material for use in the factory, consisting of $12,500 of direct material and $2,500 of indirect material. Recorded the factory payroll: $33,750 of direct labor and $3,750 of indirect labor. Incurred various overhead costs totaling $35,000. (Credit Accounts Payable.) Applied $50,000 of manufacturing overhead to the products being manufactured. Completed product casting $40,000 and moved it to the warehouse. Sold goods with a product cost of $7,500 on account for $12,500. < Ox X < X < X < a. and b. Record the transactions listed above in general journal form, post relevant portions to the four T-accounts set-up below, and balance the four accounts. General Journal Date Description Debit Credit July 5 Materials inventory Accounts payable July 9 Work in process inventory Manufacturing overhead . Materials inventory July 11 Work in process inventory Manufacturing overhead Wages payable July 17 Manufacturing overhead Accounts payable July 20 Work in process inventory . Manufacturing overhead . July 23 Finished goods inventory Work in process inventory July 26 Cost of goods sold Finished goods inventory To record cost of goods sold. July 26 Accounts receivable 0x Sales To record sale of product. X < X < X < x

Answer 1

Answer-

Date	Account Title and Explanation	Debit ($)	Credit ($)
July 5	Material inventory	5,000
	Accounts payable		5,000
July 9	Work in process inventory	12,500
	Manufacturing Overhead	2,500
	Material inventory		15,000
July 11	Work in process inventory	33,750
	Manufacturing overheads	3,750
	Wages payable		37,500
July 17	Manufacturing overheads	35,000
	Accounts payable		35,000
July 20	Work in process inventory	50,000
	Manufacturing overheads		50,000
July 23	Finished goods inventory	40,000
	Work in process inventory		40,000
July 26	Cost of goods sold	7,500
	Finished goods inventory		7,500
	(To record cost of goods sold)
July 26	Accounts receivable	12,500
	Sales		12,500
	(To record sale of product)

T-Accounts

2.

Material inventory				Finished goods inventory
Bal.	$17,500	$15,000	July 9	Bal.	$25,000	$7,500	July 26
July 5	5,000			July 23	40,000
Bal.	$7,500			Bal.	$57,500
Work in process inventory				Cost of goods sold
Bal.	$62,500	$40,000	July 23	Bal.	$75,000
July 9	12,500			July 26	7,500
July 11	33,750			Bal.	$82,500
July 20	50,000
Bal.	$118,750

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