Question

Prepare summary journal entries to record the following transactions for a company in its first month of operations. a. Raw materials purchased on account, $80,000. b. Direct materials used in production, $37,000. Indirect materials used in production, $12,000. c. Paid cash for factory payroll, $35,000. Of this total, $25,000 is for direct labor and $10,000 is for indirect labor. d. Paid cash for other actual overhead costs, $7,000. e. Applied overhead at the rate of 120% of direct labor cost. f. Transferred cost of jobs completed to finished goods, $50,470. g1. Jobs that had a cost of $50,470 were sold. g2. Sold jobs on account for $72,100. Answer is not complete. No Transaction General Journal Debit Credit 1 a. 80,000 Raw materials inventory Accounts payable 80,000 2 b(1). 37,000 Work in process inventory Raw materials inventory ✓ 37,000 3 b(2). 12,000 Factory overhead Raw materials inventory 12,000 4 C. 70,000 X Factory overhead Cash x 70,000 x 5 d. 7,000 Factory overhead Cash 7,000 6 e. 30,000 Work in process inventory Factory overhead 30,000 7 f. ✓ 50,470 Finished goods inventory Work in process inventory 50,470 8 8 g(1). x 72,100 X Accounts receivable Sales 72,100 9 g(2) x 50,470 X Cost of goods sold Finished goods inventory х 50,470 X

Answer 1

Journal entries

No	Transaction	General Journal	Debit	Credit
1	a	Raw material inventory	80000
		Account payable		80000
2	b1	Work in process inventory	37000
		Raw material inventory		37000
3	b2	Factory overhead	12000
		Raw material inventory		12000
4	C1	Work in process inventory	25000
		Factory overhead	10000
		Cash		35000
5	d	Factory overhead	7000
		Cash		7000
6	e	Work in process inventory	30000
		Factory overhead		30000
7	f	Finished goods inventory	50470
		Work in process inventory		50470
8	g1	Cost of goods sold	50470
		Finished goods inventory		50470
9	g2	Account receivable	72100
		Sales		72100