Question

Required information [The following information applies to the questions displayed below.] Sierra Company manufactures woven blankets and accounts for product costs using process costing. Data below are for one of its processing departments. The following information is available regarding its May inventories. Beginning Inventory Ending Inventory Raw materials inventory $ 60,000 $ 92,500 Work in process inventory 435,000 515,000 Finished goods inventory 633,000 605,000 The following additional information describes the company's production activities for May. Raw materials purchases (on credit) $ 250,000 Factory wages cost (paid in cash) 1,530,000 Other overhead cost (Other Accounts credited) 87,000 Materials used Direct $ 157,500 Indirect 60,000 Labor used Direct $ 780,000 Indirect 750,000 Overhead rate as a percent of direct labor 115 % Sales (on credit) $ 2,500,000 rev: 09_05_2017_QC_CS-97362 2. Prepare summary journal entries dated May 31 to record the following production activities during May: (a) raw materials purchases, (b) direct materials usage, (c) indirect materials usage, (d) direct labor costs incurred, (e) indirect labor costs incurred, (f) payment of factory wages, (g) other overhead costs, (h) overhead applied, (i) goods transferred from production to finished goods, and (j) sale of finished goods.

the last person did the jonurnal entry he didnt finish the answer.

please do the journal entry step by step and please follow the direction very careful

Answer 1

Solution:

Sierra Company
Schedule of cost of goods manufactured
For the month ended May 31
Particulars	Amount
Direct material	$157,500.00
Direct labor	$780,000.00
Applied overhead (120% of DL Cost)	$936,000.00
Total manufacturing costs	$1,873,500.00
Add: Beginning WIP	$435,000.00
Total cost of work in process	$2,308,500.00
Less: Ending WIP	$515,000.00
Cost of goods manufactured	$1,793,500.00

Sierra Company
Schedule of cost of goods Sold
For the month ended May 31
Particulars	Amount
Beginning finished goods inventory	$633,000.00
Add: Cost of goods manufactured	$1,793,500.00
Cost of goods available for sale	$2,426,500.00
Less: Ending finished goods inventory	$605,000.00
Cost of goods sold	$1,821,500.00

Journal Entries - Sierra Company
Event	Particulars	Debit	Credit
A	Raw material inventory Dr	$250,000.00
	To Accounts Payable		$250,000.00
	(To record purchase of raw material)
B	Work In Process Dr	$157,500.00
	To Raw material inventory		$157,500.00
	(To record raw material used in production)
C	Factory Overhead Dr	$60,000.00
	To Raw material inventory		$60,000.00
	(To record indirect material used)
D	Work In Process Dr	$780,000.00
	To Factory payroll payable		$780,000.00
	(To record direct labor cost incurred)
E	Factory overhead Dr	$750,000.00
	To Factory payroll payable		$750,000.00
	(To record indirect labor cost incurred)
F	Factory Payroll Payable Dr	$1,530,000.00
	To Cash		$1,530,000.00
	(To record payment of factory payroll)
G	Factory overhead Dr	$87,000.00
	To Other Account		$87,000.00
	(To record other overhead)
H	Work In Process Dr ($780,000*115%)	$897,000.00
	To Factory Overhead		$897,000.00
	(To apply overhead to production)
I	Finished goods inventory Dr	$1,793,500.00
	To Work In Process		$1,793,500.00
	(Being completed units transferred to finished goods)
J-1	Accounts receivables Dr	$2,500,000.00
	To Sales Revenue		$2,500,000.00
	(To record sales on account)'
J-2	Cost of goods sold Dr	$1,821,500.00
	To Finished goods inventory		$1,821,500.00
	(To record cost of goods sold)