Question

Fire Out Company manufactures its product, Vitadrink, through two manufacturing processes: Mixing and Packaging. The following transactions were completed during October, the company's first month of operations. 1. 2. 3. 4. 5. Purchased $301,400 of raw materials. Issued raw materials for production: Mixing $212,300 and Packaging $50,000. Incurred labor costs of $287,500. Used factory labor: Mixing $187,200 and Packaging $100,300. Incurred $981,400 of manufacturing overhead. Applied manufacturing overhead on the basis of $24 per machine hour. Machine hours were 30,700 in Mixing and 8,900 in Packaging. Transferred 47,100 units from Mixing to Packaging at a cost of $981,100. Transferred 56,000 units from Packaging to Finished Goods at a cost of $1,320,000. Sold goods costing $1,215,000. 6. 7. 8. 9. Record the October transactions using the following format. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) WORK MANUFACTURING COSTS Factory Labor Raw Materials Inventory Manufacturing Overhead Mixing 1. $ $ $ $ 2. 3.

Answer 1

	Manufacturing costs			Work In Process
	Raw materials inventory	Factory labor	Manufacturing overhead	Mixing	Packaging	Finished goods inventory	Cost of goods sold
1	301400
2	-262300			212300	50000
3		287500
4		-287500		187200	100300
5			981400
6			-950400	736800	213600
7				-981100	981100
8					-1320000	1320000
9						-1215000	1215000

Workings:
Manufacturing overhead applied:
Mixing	736800	=30700*24
Packaging	213600	=8900*24