Question

The following information relates to the manufacturing operations of O'Shaughnessy Mfg. Co. during the month of March. The company uses job order costing.

1. Purchases of direct materials during the month amount to $58,000. (All purchases were made on account.)

2. Materials requisitions issued by the Production Department during the month total $57,000.

3. Time cards of direct workers show 2,000 hours worked on various jobs during the month, for a total direct labor cost of $32,000.

4. Direct workers were paid $28,000 in March.

5. Actual overhead costs for the month amount to $33,000 (for simplicity, you may credit Accounts Payable).

6. Overhead is applied to jobs at a rate of $18 per direct labor hour.

7. Jobs with total accumulated costs of $110,000 were completed during the month.

8. During March, units costing $130,000 were sold for $200,000. (All sales were made on account.)

Required:

Prepare general journal entries to summarize each of these transactions in the company's general ledger accounts. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Answer 1

	General journal	Debit	Credit
a	Materials inventory	58000
	Accounts Payable		58000
b	Work in process inventory	57000
	Materials inventory		57000
c	Work in process inventory	32000
	Factory labor/Wages payable		32000
d	Factory labor/Wages payable	28000
	Cash		28000
e	Manufacturing overhead	33000
	Accounts Payable		33000
f	Work in process inventory	36000		=2000*18
	Manufacturing overhead		36000
g	Finished goods inventory	110000
	Work in process inventory		110000
h	Accounts Receivable	200000
	Sales		200000
	Cost of goods sold	130000
	Finished goods inventory		130000