Question

ournal Entries

Shorts Company has three process departments: Mixing, Encapsulating, and Bottling. At the beginning of the year, there were no work-in-process or finished goods inventories. The following data are available for the month of July:

Department		Manufacturing Costs Added*		Ending Work in Process
Mixing		$83,270		$22,700
Encapsulating		75,160		18,130
Bottling		71,520		2,980

*Includes only the direct materials, direct labor, and the overhead used to process the partially finished goods received from the prior department. The transferred-in cost is not included.

Required:

1. Prepare journal entries that show the transfer of costs (a) from Mixing to Encapsulating, (b) from Encapsulating to Bottling, and (c) from Bottling to finished goods inventory.

a.		_
b.
			f
c.

2. Post the entries made in Requirement 1 into the T-accounts below. The costs added from the data provided have been entered in the T-accounts.

WIP—Mixing
	83,270	fill in the blank
	22,700

WIP—Encapsulating
	fill in the	fill in the blank
	75,160
	18,130

WIP—Bottling
	fill in the blank	fill in the blank
	71,520
	2,980

Finished Goods
	fill in the blank

Answer 1

Answer:

Date	Account Titles and Explanation	Debit	Credit
1	Work - in - process inventory - Encapsulating	$           60570
	Work - in - process inventory - Mixing		$           60570
	Work - in - process inventory - Bottling	$       117600
	Work - in - process inventory - Encapsulating		$       117600
	Finished goods inventory	$       186140
	Work - in - process inventory - Bottling		$       186140
2	Work - in - process inventory - Mixing
		$           83270	$           60570
		$           22700
	Work - in - process inventory - Encapsulating
		$           60570	$       117600
		$           75160
		$           18130
	Work - in - process inventory - Bottling
		$       117600	$       186140
		$           71520
		$             2980
	Finished goods inventory
		$       186140