Question

3. (9 points) Palden Company recorded the following transactions for the just completed month. The company had no beginning inventories. (a) $72,000 in raw materials were purchased for cash. (6) $67,000 in raw materials were requisitioned for use in production. Of this amount, $56,000 was for direct materials and the remainder was for indirect materials. (c) Total labor wages of $112,000 were incurred and paid in cash. Of this amount, 894,000 was for direct labor and $18,000 was for indirect labor. (d) Additional manufacturing overhead costs of $108,000 were incurred and paid in cash. (C) Manufacturing overhead costs of $130,000 were applied to jobs using the company's predetermined overhead rate. (1) All of the jobs worked on during the month were completed and shipped to customers. (g) The underapplied or overapplied overhead for the month was closed out to Cost of Goods Sold. Required: Record each transactions using either Journal Entries or Taccounts. Nex Previous SIY Q $ % # 3 & 7 4 5 6 8 9

Answer 1

Solution:

Cash
Beg. Bal.		72,000	a
		1,12,000	c
		1,08,000	d
End. Bal.		2,92,000

Raw Materials
Beg. Bal.
a.	72,000	67,000	b
End. Bal.	5,000

Work In Process
Beg. Bal.
b.	56,000	2,80,000	f
c.	94,000
e.	1,30,000
End Bal.	0

Finished Goods
Beg. Bal
f.	2,80,000	2,80,000	g
End. Bal.	0

Manufacturing Overhead
Beg. Bal.
b.	11,000	1,30,000	e
c.	18,000	7,000	h
d.	1,08,000
End. Bal.	0

Cost of goods sold
Beg. Bal.
g.	2,80,000
h.	7,000
End. Bal.	2,87,000

The excel sheets shows the T Accounts of palden company