Question

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Pro-Weave manufactures stadium blankets by passing the products through a weaving department and a sewing department The following information is available regarding its June inventories: Work in process inventory Weaving The following additional information describes the company's manufacturing activities for June: Raw material purchase on Factory payroll contadinah Oractory overhead con Ac credited 1. Compute the (a) cost of products transferred from weaving to sewing, (b) cost of products transferred from sewing to finished goods, and (c) cost of goods sold. Fished Goods Cost of goods 2. Prepare journal entries dated June 30 to record (a) goods transferred from weaving to sewing. (b) goods transferred from sewing to finished goods, and (c) sale of finished goods. Journal entry worksheet Record the goods transferred from weaving to sewing Date General Journal Debt Credit

Answer 1

1)a) Compute the cost of products transferred from Weaving to Sewing
Particulars	Amount($)
Materials used	$ 240,000
Labor Used	$ 1,200,000
Manufacturing Overhead ($1,200,000*80%)	$ 960,000
Total Manufacturing Costs	$ 2,400,000
Add: Work in process -Beginning	$ 300,000
Total	$ 2,700,000
Less: Work in process-Ending	($330,000)
Cost of Goods Manufactured	$ 2,370,000
Hence, Cost of products transferred from Weaving to Sewing
is $ 2,370,000
1)b) Compute the cost of products transferred from Sewing to finished goods
Particulars	Amount($)
Materials used	$ 75,000
Labor Used	$ 360,000
Manufacturing Overhead ($360,000*150%)	$ 540,000
Cost of products transferred from Weaving to Sewing	$ 2,370,000
Total Manufacturing Costs	$ 3,345,000
Add: Work in process -Beginning	$ 570,000
Total	$ 3,915,000
Less: Work in process-Ending	($700,000)
Cost of Goods Manufactured	$ 3,215,000
Hence, Cost of products transferred from Sewing to finished goods
is $ 3,215,000
1)c) Compute the cost of goods sold :
Particulars	Amount($)
Cost of goods manufactured (Transferred from Sewing )	$ 3,215,000
Add: Finished Goods inventory -Beginning	$ 1,266,000
Goods Available for sale	$ 4,481,000
Less: Finished goods inventory-Ending	($ 1,206,000)
Cost of goods sold	$ 3,275,000

No	Date	General Journal	Debit	Credit
1)	Jun-30	Work in process- Sewing	$ 2,370,000
		Work in process- Weaving		$ 2,370,000
		(To record goods transferred from weaving to sewing )
2)	Jun-30	Finished Goods	$ 3,215,000
		Work in process- Sewing		$ 3,215,000
		(To record goods transferred from Sewing to Finished goods )
3)	Jun-30	Accounts Receivable	$ 4,000,000
		Sales Revenue		$ 4,000,000
		(To record sale of goods on credit )
4)	Jun-30	Cost of goods sold	$ 3,275,000
		Finished Goods		$ 3,275,000
		(to record cost of goods sold )