Question

Lubricants, Inc., produces a special kind of grease that is widely used by race car drivers. The grease is produced in two processing departments—Refining and Blending. Raw materials are introduced at various points in the Refining Department. The following incomplete Work in Process account is available for the Refining Department for March: March 1 balance Work in Process-Refining Department 31,600 Completed and transferred to Blending 152,600 70,200 485,000 Materials Direct labor Overhead March 31 balance The March 1 work in process inventory in the Refining Department consists of the following elements: materials, $7,300; direct labor, $3,000; and overhead, $21,300. Costs incurred during March in the Blending Department were: materials used, $44,000; direct labor, $16,900; and overhead cost applied to production, $99,000.

Answer 1

Credit bi Transactions General Journal Debit Work in hoceu- Refining bepartment 152,600. Work in Process -Blending department 44,000 Raw Materials $ 196,600 (to record issuance of raw materials Work in Process - Refiming separtment: 70,200 Work in Process - Blending Department $ 16,900 Salaries and wages Payable $87,00 Ko second divest labor cost incurred) Manufacturing Overhead $706,000 Accounts Payable $706,000 Ho record manufacturing expensess d (1) Work in Process - Refining Department $ 485,000 Manufacturing Overhead &485,000 (to recond overhead cost applied) d(2) Work in Process - Blending Department $99,000 Manufacturing overhead $99,000 Ho record overhead cost applied) Work in Process - Blending Department &672,000 Work in Process - Refining Department to record transfer of semifinished units) $672,000

f finished Goods Work in Process - Blending Department to record transfer of completed unity $730000 $730,000 4) Accounts Receivable Sales (Yo record sales on account) $1390,000 $ 1,390,000 gly cost of Goods gold finished goods (Ho necoad cost of goods rold) $600,000 $600,000 Raw materials Accounts Receivable Liga go $1,390,000 Beg. Bel. $ 205,600 (a, $196,600 Endi Bal & 9000

Work in process Refining Department Begnbul. $ 31,600 [ foy $152,600 Les $672,000 bi $70,200 $485,000 Work in Process Blending Department Beg Bal $41,000 #44,000 6 $730,000 b $16, 900 id, $99,000 $672,000 راه End: Bal & End. Bat. 1$ 142,900 finished Goods Beg Bal. $27,000 $730000g $600,000 Manufacturing overhead $706,000 as $584,000 End Bal End Bal $157,000 Accounts payable (6 & 70 6,000 Salaries and wages Payable b $ 87, loo cost of Goods, sold Sales 194 1,390,000 lige $600,000 calculation: cols Mancsfactuning Overhead = (Manufacturing Overhead Refining Department & Manufacturing Overhead Blending Department) = $ 485,000 + $ 99,000 = $584,000