Question

  

Pro-Weave manufactures stadium blankets by passing the products through a weaving department and a sewing department The following information is available regarding its June inventories Beginning Ending Inventory 261 198 475 690 Raw materials inventory 540 Work in process inventory.Weaving Work in process inventorySewing Finished goods inventory 860 1.406 1,296 The following additional information describes the company's manufacturing activities for June: 700 505 216 Raw materials purchases (on credit) Factory wages cost (paid in cash) Other factory overhead cost (Other Accounts credit Materials used 296 81 156 Indirect Labor used 400 505 600 Indirect ead rates as a percent of direct labor Weaving Sewing Sales (on credit) Overh 170% 950,000 1. Compute the (a) cost of products transferred from weaving to sewing, (b) cost of products transferred from sewing to finished goods, and (c) cost of goods sold. 2. Prepare journal entries dated June 30 to record (a) goods transferred from weaving to sewing, (b) goods transferred from sewing to finished goods, and (c) sale of finished goods Required 1Required 2 Compute the (a) cost of products transferred from weaving to sewing, (b) cost of products transferred from sewing to finished goods, and (c) cost of goods sold (a) Sewing (b) Finished Goods (c) Cost of goods sold Record the goods transferred from weaving to sewing. Note: Enter debits before credits Date General Journal Debit Credit June 30 Record the goods transferred from weaving to sewing. 1 2 Record the goods transferred from sewing to finished goods. 3 Record the sale of goods on account. 4 Record the cost of goods sold

Answer 1

(a)	Sewing	$ 27,51,000.00
(b)	Finished	$ 40,25,500.00
(c )	Cost of Goods Sold	$ 96,52,500.00
	Cost of products transferred from Weaving to Sewing				Cost of products transferred from Sewing to Finished Goods
	Particulars	Amount			Particulars	Amount
	Direct Material used	$    2,96,000.00			Cost of production Transferred from Weaving	$ 27,51,000.00
	Direct Labor used	$ 14,00,000.00			Direct Material used	$        81,000.00
	Overheads (80% on Direct Labor (1400000*80%)	$ 11,20,000.00			Direct Labor used	$    5,05,000.00
	Production Cost	$ 28,16,000.00			Overheads (80% on Direct Labor (505000*170%)	$    8,58,500.00
	Add: Work-in-progress Beginning	$    4,75,000.00			Production Cost	$ 41,95,500.00
	Less: Work-in-progress End	$    5,40,000.00			Add: Work-in-progress Beginning	$    6,90,000.00
	Cost of products transferred from Weaving to Sewing	$ 27,51,000.00			Less: Work-in-progress End	$    8,60,000.00
					Cost of products transferred from Weaving to Sewing	$ 40,25,500.00
	Cost of Goods sold
	Particulars	Amount	Amount		Journal Entry
	Direct Material Used				Weaving	$ 27,51,000.00
	Beginning raw Material inventory	$    1,98,000.00			Sweing		$ 27,51,000.00
	Add: Cost of Raw Material Purchased	$    7,00,000.00			( Goods Transferred from Weaving to Sewing)
	Total Raw Material available	$    8,98,000.00
	Less: Ending raw Material Inventory	$    2,61,000.00			Sewing	$ 40,25,500.00
	Total Raw Material Used		$    6,37,000.00		Finished Goods		$ 40,25,500.00
	Direct Labor				( Goods Transferred from Sewing to Finished Goods)
	Weaving		$ 14,00,000.00
	Sewing		$    5,05,000.00		Accounts Receivables	$ 49,50,000.00
	Manufacturing Overhead				Sales Revenue		$ 49,50,000.00
	Indirect Material	$    1,56,000.00			(Sale of Fnished Goods)
	Indirect Labor	$ 16,00,000.00
	Overhead Rate
	Weaving	$ 11,20,000.00
	Sewing	$    8,58,500.00
	Factory Wages cost	$ 35,05,000.00
	Other Overhead Cost	$    2,16,000.00
	Total Manufacturing Overhead		$ 74,55,500.00
	Total Manufacturing Cost		$ 99,97,500.00
	Add: Beginning work-in-process Weaving & Sewing		$ 11,65,000.00
	Less: Ending work-in-process Weaving & Sewing		$ 14,00,000.00
	Cost of Production		$ 97,62,500.00
	Add: Beginning Finished Goods		$ 12,96,000.00
	Less: Ending Finished Goods		$ 14,06,000.00
	Cost of Goods Sold		$ 96,52,500.00