Question

Required Information The following information applies to the questions displayed below] 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 Inventory 156,000 355,000 Ending Inventory $ 245,000 425,000 Raw materials inventory Work in process inventory- Weaving Work in process inventory- Sewing Finished goods inventory 735,000 1,426,000 970,000 1,326,000 The following additional information describes the company's manufacturing activities for June: $ 665,000 3,120,000 198,000 $ 284,000 132,000 170,000 Raw materials purchases (on credit) Factory payroll cost (paid in cash) Other factory overhead cost (Other Accounts credited) Materials used Direct-Weaving Direct-Sewing Indirect Labor used Direct-Weaving Direct-Sewing Indirect Overhead rates as a percent of direct labor Weaving Sewing Sales (on credit) $1,375,000 445,000 1,625,000 80% 170% $4,350,000

Answer 1

Solution 1a:

Pro-Weave Manufacturer
Cost of products transferred from weaving to sewing
Particulars	Amount
Raw material used in Weaving	$2,84,000.00
Direct Labor - Weaving	$13,75,000.00
Manufacturing overhead Applied - Weaving (80% of DL)	$11,00,000.00
Cost Incurred during the period in production	$27,59,000.00
Add: Opening WIP	$3,55,000.00
Less: ending WIP	$4,25,000.00
Cost of goods transferred from Weaving to Sewing	$26,89,000.00

Solution 1b:

Pro-Weave Manufacturer
Cost of products transferred from Sewing to Finished Goods
Particulars	Amount
Cost of goods transferred from Weaving	$26,89,000.00
Raw material used in Sewing	$1,32,000.00
Direct Labor - Weaving	$4,45,000.00
Manufacturing overhead Applied - Weaving (170% of DL)	$7,56,500.00
Cost Incurred during the period in production	$40,22,500.00
Add: Opening WIP	$7,35,000.00
Less: ending WIP	$9,70,000.00
Cost of goods manufactured and transferred to finished goods	$37,87,500.00

Solution 1c:

Pro-Weave Manufacturer
Schedule of cost of goods Sold
Particulars	Amount
Beginning finished goods inventory	$14,26,000.00
Add: Cost of goods manufactured	$37,87,500.00
Less: ending finished goods inventory	$13,26,000.00
Cost of goods sold	$38,87,500.00

Solution 2:

Journal Entries - Pro-Weave Manufacturer
Event	Particulars	Debit	Credit
a	Work in Process - Sewing Department Dr	$26,89,000.00
	To Work in process - Weaving Department		$26,89,000.00
	(To cost of completed units in weaving transferred to Sewing department)
b	Finished Goods Inventory Dr	$37,87,500.00
	To Work in process - Sewing Department		$37,87,500.00
	(To cost of completed units in sewing transferred to finished goods)
c-1	Accounts receivables Dr	$43,50,000.00
	To Sales Revenue		$43,50,000.00
	(To record sale finished goods)
c-2	Cost of goods sold Dr	$38,87,500.00
	To Finished goods inventory		$38,87,500.00
	(Being cost of inventory sold transferred to COGS)