In: Accounting
Enter the following entries for the month of August.
A. Purchased raw materials on account: $3,100.
B. Selling and Administrative expenses incurred and paid: $1,200.
C. Used direct materials: $3,900.
D. Used indirect materials: $300.
E. Manufacturing wages incurred totaled $4,000, of which 90% was direct labor and 10% was indirect labor.
F. Incurred other actual factory overhead on account: $1,300.
G. Factory Overhead was allocated to Work in Process Inventory at a predetermined overhead allocation rate of 60% of Direct Labor costs incurred during August.
H. The cost of product completed: $10,000.
I. Sales on account: $17,500. The cost of the units sold was $9,500.
What would the journal entries for this look like?
Answer-
Transaction | Account Title and Explanation | Debit ($) | Credit ($) |
A. | Raw Materials Inventory | 3,100 | |
Accounts Payable | 3,100 | ||
(To record purchase of raw materials on account) | |||
B. | Selling and Administrative Expenses | 1,200 | |
Cash | 1,200 | ||
(To record selling and administrative expenses paid) | |||
C. | Work in Process | 3,900 | |
Raw Materials Inventory | 3,900 | ||
(To raw materials used in production) | |||
D. | Factory Overhead | 300 | |
Raw Materials Inventory` | 300 | ||
(To record use of indirect materials) | |||
E. | Work in Process ($4,000*90%) | 3,600 | |
Factory Overhead ($4,000*10%) | 400 | ||
Accounts Payable | 4,000 | ||
(To record direct and indirect wages incurred) | |||
F. | Factory Overhead | ,1,300 | |
Accounts Payable | 1,300 | ||
(To record factory overhead incurred) | |||
G. | Work in Process | 2,160 | |
Factory Overhead | 2,160 | ||
(To record factory overhead assigned to work in process at 60% of direct labor cost; 3,600 x 60% = $2,160) | |||
H. | Finished Goods Inventory | 10,000 | |
Work in Process | 10,000 | ||
(To record cost of products completed) | |||
I. | Accounts Receivable | 17,500 | |
Sales | 17,500 | ||
Cost of Goods Sold | 9,500 | ||
Finished Goods Inventory | 9,500 | ||
(To record cost of goods sold) |