Question

Exercise #4:   A Manufacturing Corporation had the following transactions for its first month of operations:

1.     The Corporation purchased raw materials on account, $85,000.
2.     Factory managers requisitioned Raw Materials of $30,000 to the factory. The materials requisition slips indicated that $6,000 was classified as indirect materials.
3.     Factory labor costs incurred were $125,000 of which $100,000 pertained to factory wages payable and $25,000 pertained to employer payroll taxes payable.
4.     Time tickets indicated that $104,000 was direct labor and $21,000 was indirect labor.
5.     Overhead costs incurred on account were $112,000.
6.     Manufacturing overhead was applied at the rate of 150% of direct labor cost.
7.     Goods costing $135,000 are still incomplete at the end of the month; the other goods were completed and transferred to finished goods.
8.     Finished goods costing $100,000 to manufacture were sold on account for $130,000.

Instructions

Journalize the above transactions for the Manufacturing Corporation.

Answer 1