Question

Laffer Lumber produces bagged bark for use in landscaping. Production involves packaging bark chips in plastic bags in a bøgg department. The following information describes production operations for October. ing Bagging Department $ 236,000 S 44,000 Direct materials used Direct labor used Predetermined overhead rate (based on direct labor) Goods transferred from bagging to finished goods 130% (200,000) The company's revenue for the month totaled $440.000 from credit sales, and its cost of goods sold for the month is $248.000 Prepare summary journal entries dated October 31 to record its October production activities for (1) direct materials usage. (2) direct labor incurred (3) overhead allocation, (4) goods transfer from production to finished goods, and (5) credit sales. Journal entry worksheet Note: Od 31

Answer 1

Journal entries in the books of Laffer Lumber General Journal Date Account Title and explanation Debit (in S) Credit (in S) 31-Oct Goods in process inventorv 236,000 Raw Material Invento To record direct material usage 236,000 31-Oct Goods in process inventorv 44.000 Factorv pavroll To record direct labor used 44.000 31-Oct l Goods in process inventory ($44,000*130%) 57,200 Factorv overhead To record overhead allocated 57,200 31-OctFinished Goods Inventory 200,000 Goods in process inventorv 200,000 To record goods transferred from production to finished goods 31-OctAccounts receivables 440,000 Sales To record sale of goods on credit 440,000 31-OctCost of Goods sold 248,000 Finished Goods Inventorv To record cost of goods sold 248,000