Question

Entries for Flow of Factory Costs for Process Cost System Sweeties, Inc., manufactures a sugar product by a continuous process, involving three production departments-Refining, Sifting, and Packing. Assume that records indicate that direct materials, direct labor, and applied factory overhead for the first department, Refining, were $536,500, $187,800, and $123,400, respectively. Also, work in process in the Refining Department at the beginning of the period totaled $30,000, and work in process at the end of the period totaled $37,000. a. Journalize the entries to record the flow of costs into the Refining Department during the period for (1) direct materials, (2) direct labor, and (3) factory overhead. 3. - b. Journalize the entry to record the transfer of production costs to the second department, Sifting.

Answer 1

Journal Entries:

a)		Debit	Credit
1)	Work-in Process Inventory - Refining Department	$536,500
	Direct Materials		$536,500
	(To record the flow of direct material costs to the Refining Department)
2)	Work-in Process Inventory - Refining Department	$187,800
	Direct Labor		$187,800
	(To record the flow of direct material costs to the Refining Department)
3)	Work-in Process Inventory - Refining Department	$123,400
	Factory Overheads		$123,400
	(To record the flow of factory overhead costs to the Refining Department)
b)		Debit	Credit
	Work-in Process Inventory - Sifting Department	$840,700
	Work-in Process Inventory - Refining Department ($30,000 + $536,500 + $187,800 + $123,400 - $37,000)		$840,700
	(To record the transfer of production costs to the Sifting Department)