1) Journal Entries: | ||||
Date | Accounts Title | Debit (P) | Credit (P) | |
1 | Direct material | 80000 | ||
Accounts Payable | 80000 | |||
(being purchase of direct materials) | ||||
2 | Work in Progress | 42000 | ||
Manufacturing Overhead | 11500 | |||
Wages payable | 53500 | |||
(being labor made payable) | ||||
3 | Manufacturing Overhead | 67200 | ||
Accounts Payable | 67200 | |||
(being manufacturing equipment purchased) | ||||
4 | Manufacturing Overhead | 80500 | ||
Accounts Payable | 80500 | |||
(being other manufacturing overhead incurred) | ||||
5 | Work in Progress | 56000 | ||
Direct material | 56000 | |||
(being 70% of DM transferred to WIP) | ||||
5.1 | Work in Progress | 159200 | ||
Manufacturing Overhead | 159200 | |||
(Being all Manufacturing overhead transferred to | ||||
WIP A/C) | ||||
6 | Finished Goods | 154320 | ||
Work in Progress | 154320 | |||
Goods finished=(42000+56000+159200)*60%=154320 | ||||
7 | COGS | 138888 | ||
Finished Goods | 138888 | |||
(Being 90% of the finished goods sold) | ||||
2) T-Accounts: | ||||
Direct Material A/c | ||||
Debit | Amount | Credit | Amount | |
AP | 80000 | WIP | 56000 | |
CB | 24000 | |||
Manufacturing Overhead A/c | ||||
Sup.labor | 11500 | WIP | 159200 | |
Manu. Eq. | 67200 | |||
Other exp | 80500 | |||
Work in Progress A/c | ||||
DM | 56000 | FG Inv. | 154320 | |
DL | 42000 | CB | 102880 | |
Manu. o/h | 159200 | |||
Total | 257200 | Total | 257200 | |
Finished Goods Inventory A/c | ||||
WIP | 154320 | COGS | 138888 | |
CB | 15432 | |||
Cost of Goods Sold A/c | ||||
FG Inv. | 138888 | |||
3) Cost of Goods Sold Statement: | ||||
Amount | ||||
Material: | ||||
Purchased | 80000 | |||
Less:CB | 24000 | |||
Direct mat. Applied | 56000 | |||
Direct labor applied | 42000 | |||
Manuf. Overhead | 159200 | |||
Total Manuf. Costs incurred | 257200 | |||
Less:WIP - CB | -102880 | |||
Finished Goods | 154320 | |||
Less:FG-CB | -15432 | |||
Cost of Goods Sold | 138888 |
Problem 1 (Flow of an accounting for the manufacturing company) The following events took place at...
The following events took place at a manufacturing company for the current year: (1) Purchased $95,800 in direct materials. (2) Incurred labor costs as follows: (a) direct, $56,800 and (b) indirect, $14,400. (3) Other manufacturing overhead was $107,800, excluding indirect labor. (4) Transferred 80% of the materials to the manufacturing assembly line. (5) Completed 65% of the Work-in-Process during the year. (6) Sold 85% of the completed goods. (7) There were no beginning inventories. What is the value of the...
The following events took place at a manufacturing company for the current year: (1) Purchased $95,800 in direct materials. (2) Incurred labor costs as follows: (a) direct, $56,800 and (b) indirect, $14,400. (3) Other manufacturing overhead was $107,800, excluding indirect labor. (4) Transferred 80% of the materials to the manufacturing assembly line. (5) Completed 65% of the Work-in-Process during the year. (6) Sold 85% of the completed goods. (7) There were no beginning inventories. What is the value of the...
Assume that the following events occurred at a division of Generic Electric for March of the current year: 1. Purchased $100 million in direct materials. 2. Incurred direct labor costs of $57 million. 3. Determined that manufacturing overhead was $83 million. 4. Transferred 80 percent of the materials purchased to work-in-process. 5. Completed work on 75 percent of the work-in-process. Costs are assigned equally across all work-in-process. 6. The inventory accounts have no beginning balances. All costs incurred were...
Financial Statements of a Manufacturing Firm The following events took place for Sorensen Manufacturing Company during January, the first month of its operations as a producer of digital video monitors: Purchased $66,300 of materials. Used $51,100 of direct materials in production. Incurred $76,200 of direct labor wages. Incurred $107,400 of factory overhead. Transferred $178,300 of work in process to finished goods. Sold goods for $318,900. Sold goods with a cost of $141,900. Incurred $81,500 of selling expense. Incurred $35,800 of...
Financial Statements of a Manufacturing Firm The following events took place for Sorensen Manufacturing Company during January, the first month of its operations as a producer of digital video monitors: Purchased $250,000 of materials. Used $180,000 of direct materials in production. Incurred $450,000 of direct labor wages. Incurred $180,000 of factory overhead. Transferred $760,000 of work in process to finished goods. Sold goods for $1,200,000. Sold goods with a cost of $675,000. Incurred $215,000 of selling expense. Incurred $125,000 of...
Financial Statements of a Manufacturing Firm The following events took place for Sorensen Manufacturing Company during January, the first month of its operations as a producer of digital video monitors: Purchased $48,300 of materials. Used $37,200 of direct materials in production. Incurred $55,500 of direct labor wages. Incurred $78,200 of factory overhead. Transferred $129,900 of work in process to finished goods. Sold goods for $232,300. Sold goods with a cost of $103,400. Incurred $59,400 of selling expense. Incurred $26,100 of...
Financial Statements of a Manufacturing Firm The following events took place for Digital Vibe Manufacturing Company during January, the first month of its operations as a producer of digital video monitors: Purchased $50,400 of materials Used $38,800 of direct materials in production. Incurred $58,000 of direct labor wages. Incurred $81,600 of factory overhead. Transferred $135,600 of work in process to finished goods. Sold goods for $242,400. Sold goods with a cost of $107,900. Incurred $62,000 of selling expenses. Incurred $27,200...
Financial Statements of a Manufacturing Firm
The following events took place for Digital Vibe Manufacturing
Company during January, the first month of its operations as a
producer of digital video monitors:
Purchased $54,300 of materials
Used $41,800 of direct materials in production.
Incurred $62,400 of direct labor wages.
Incurred $88,000 of factory overhead.
Transferred $146,100 of work in process to finished goods.
Sold goods for $261,200.
Sold goods with a cost of $116,200.
Incurred $66,800 of selling expenses.
Incurred $29,300...
Financial Statements of a Manufacturing Firm The following events took place for Digital Vibe Manufacturing Company during January, the first month of its operations as a producer of digital video monitors: Purchased $54,600 of materials Used $42,000 of direct materials in production. Incurred $62,800 of direct labor wages. Incurred $88,500 of factory overhead. Transferred $146,900 of work in process to finished goods. Sold goods for $262,600. Sold goods with a cost of $116,800. Incurred $67,200 of selling expenses. Incurred $29,500...
Financial Statements of a Manufacturing Firm The following events took place for Digital Vibe Manufacturing Company during March, the first month of its operations as a producer of digital video monitors: Purchased $46,400 of materials. Used $35,700 of direct materials in production. Incurred $53,400 of direct labor wages. Incurred $75,200 of factory overhead. Transferred $124,800 of work in process to finished goods. Sold goods for $223,200. Sold goods with a cost of $99,300. Incurred $57,100 of selling expense. Incurred $25,100...