Question

The Polaris Company uses a job-order costing system. The following data relate to October, the first month of the company’s fiscal year.

a.	Raw materials purchased on account, $210,000.
b.	Raw materials issued to production, $190,000 ($152,000 direct materials and $38,000 indirect materials).
c.	Direct labor cost incurred, $49,000; indirect labor cost incurred, $20,000.
d.	Depreciation recorded on factory equipment, $106,000.
e.	Other manufacturing overhead costs incurred during October, $130,000 (credit Accounts Payable).
f.	The company applies manufacturing overhead cost to production on the basis of $9 per machine-hour. A total of 76,200 machine-hours were recorded for October.
g.	Production orders costing $515,000 according to their job cost sheets were completed during October and transferred to Finished Goods.
h.	Production orders that had cost $448,000 to complete according to their job cost sheets were shipped to customers during the month. These goods were sold on account at 34% above cost.

Required:
1.	Prepare journal entries to record the information given above.

Answer 1