Question

Bayas Corporation uses process costing. A number of transactions that occurred in June are listed below.

1. (1) Raw materials that cost $40,900 are withdrawn from the storeroom for use in the Mixing Department. All of these raw materials are classified as direct materials.

2. (2) Direct labor costs of $17,200 are incurred, but not yet paid, in the Mixing Department.

3. (3) Manufacturing overhead of $46,800 is applied in the Mixing Department using the department’s predetermined overhead rate.

4. (4) Units with a carrying cost of $88,700 finish processing in the Mixing Department and are transferred to the Drying Department for further processing.

5. (5) Units with a carrying cost of $112,400 finish processing in the Drying Department, the final step in the production process, and are transferred to the finished goods warehouse.

6. (6) Finished goods with a carrying cost of $99,300 are sold.

Required:

Prepare journal entries for each of the transactions listed above. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Journal entry worksheet 1-6

Answer 1

Solution:

Journal Entries - Bayas Corporation
Event	Particulars	Debit	Credit
1	Work In Process - Mixing Dr	$40,900.00
	To Raw Material Inventory		$40,900.00
	(To record raw material used in mixing department)
2	Work In Process - Mixing Dr	$17,200.00
	To Wages Payable		$17,200.00
	(To record direct labor cost incurred)
3	Work In Process - Mixing Dr	$46,800.00
	To Manufacturing overhead		$46,800.00
	(To record manufacturing overhead applied)
4	Work In Process - Drying Dr	$88,700.00
	To Work In Process - Mixing		$88,700.00
	(Being completed cost transferred to drying for further processing)
5	Finished Goods Inventory Dr	$112,400.00
	To Work In Process - Drying		$112,400.00
	(Being units completed transferred to finished goods)
6	Cost of goods sold Dr	$99,300.00
	To Finished Goods Inventory		$99,300.00
	(To record cost of goods sold)