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 Work in Process-Refining Department March 1 balance Completed and transferred to Blending Materials 155,600 Direct labor 30,200 Overhead 472.000 March 31 balance The March 1 work in process inventory in the Refining Department consists of the following elements: materials, $8,300, direct labor, $4,800; and overhead, $20,500 Costs incurred during March in the Blending Department were materials used, 546,000, direct labor, $16,800, and overhead cost applied to production, $111,000. Required: 1. Prepare journal entries to record the costs incurred in both the Refining Department and Blending Department during March Key your entries to the items (a) through (g) below a. Raw materials used in production b. Direct labor costs incurred Manufacturinn verhead cocte incurred for the entire factar 5676 ON Icrerit Arenunte PAVA

Answer 1

Journal entries Debil ($) General Journal credit (I) No a 155600 46000 Work in procen inventory-refining Work in procen inventory - blending Raw material inventory (for maturals used in productions 201600 80200 Work in process inventory-refining Work in procen inventory - blending 16800 Salaries and wages payable (for direct labour costs incurredo 97ooo 676000 C) Manujauturing overhead payable Account 676000 (for mo o incurreal dl 477000 Ber M M 588000 1 Work in process inventory-refining Work in procen inventory blending 111000 Manufacturing over head ( for Manufacturing ound appuied based on predetermined rate) Wook in procen inventory - blending Wook in process inventory - defining (for tof of completed units from running C 662000 662000 Eu to blending) Beg 710000 Finished a 710ooo goods inventory Work in procen inventory - blending Cfor tool of computed units to finished goods inventory C €

1480000 9) Accounts receivable sales 1480000 (for sales of finished goods 6, 20000 Cost of goods sold 620ooo Finished goods Inventory (for cous of goode solds Raw maturals Inventory Manufacturing ound bal Beg Big bar 205600 d 588000 201600 С C 676000 Endbal 88000 End bal yooo Auounts receivable Work in Proces. Refining 33,600 662000 е e 1480000 Beg bal g 155600 80200 d 477000 Endbal 1480000 84400 End bal B Accounts Payable Work in procen. Blend f 49000 Begbal 710000 676000 46000 b d 16800 (11000 662000 End ba 676000 १ & е e End bal 174800

Salain l wages payable Finished goods Invento Begbal 23000 f 710000 Begbal dan 9 620000 b Б 97000 Endbal Endbal 9700 Sales Cost of goods sold 1480000 g 620000 Endba 1480ou Eudbal 620000