Question

An incomplete subsidiary ledger of materials inventory for May is as follows:

a. Complete the materials issuances and balances for the materials subsidiary ledger under FIFO.

Received				Issued				Balance
Receiving Report Number	Quantity	Unit Price		Materials Requisition Number	Quantity	Amount		Date	Quantity	Unit price	Amount
								May 1	370	$6	$2,220
27	260	$8						May 4
				100	420	$		May 10
33	170	10						May 21
				113	250			May 27

b. Determine the materials inventory balance at the end of May.
$

c. Journalize the summary entry to transfer materials to work in process.

	Work in Process
	Materials

Answer 1

• All working forms part of the answer
• Requirement ‘a’

Received				Issued				Balance
Receiving	Quantity	Unit		Materials	Quantity	Amount		Date	Quantity	Unit	Amount
Report		Price		Requisition						price
Number				Number
	[A]	[B]	[A x B]		[C]	[D]			[E]	[F]	[E x F]
								May-01	370	$                   6.00	$       2,220.00
27	260	$                          8.00	$                       2,080.00					May-04	370	$                   6.00	$       2,220.00
									260	$                   8.00	$       2,080.00
				100	420	$          2,620.00 [(370 x 6) + (50 x 8)]		May-10	210	$                   8.00	$       1,680.00
33	170	$                       10.00	$                       1,700.00					May-21	210	$                   8.00	$       1,680.00
									170	$                10.00	$       1,700.00
				113	250	$          2,080.00 [(210 x 8) + (40 x 10)		May-27	130	$            10.00	$       1,300.00

• Requirement ‘b’

Material Inventory at the end = 130 units at $ 10 = $ 1,300.00

• Requirement ‘c’

Amount = 420 units at $ 2,620 + 250 units at $ 2,080 = 2620 + 2080 = $ 4,700

Work in Process	$ 4,700
Materials		$ 4,700