Question

Entries for Costs in a Job Order Cost System Royal Technology Company uses a job order cost system. The following data summarize the operations related to production for March: Materials purchased on account, $770,000. Materials requisitioned, $680,000, of which $75,800 was for general factory use. Factory labor used, $756,000, of which $182,000 was indirect. Other costs incurred on account for factory overhead, $245,000; selling expenses, $171,500; and administrative expenses, $110,600. Prepaid expenses expired for factory overhead, $24,500; for selling expenses, $28,420; and for administrative expenses, $16,660. Depreciation of factory equipment was $49,500; of office equipment, $61,800; and of office building, $14,900. Factory overhead costs applied to jobs, $568,500. Jobs completed, $1,500,000. Cost of goods sold, $1,375,000. Required: Journalize the entries to record the summarized operations. For a compound transaction, if an amount box does not require an entry, leave it blank. a. Materials purchased on account, $770,000. Entry Description Debit Credit a. b. Materials requisitioned, $680,000, of which $75,800 was for general factory use. Entry Description Debit Credit b. c. Factory labor used, $756,000, of which $182,000 was indirect. Entry Description Debit Credit c. d. Other costs incurred on account for factory overhead, $245,000; selling expenses, $171,500; and administrative expenses, $110,600. Entry Description Debit Credit d. e. Prepaid expenses expired for factory overhead, $24,500; for selling expenses, $28,420; and for administrative expenses, $16,660. Entry Description Debit Credit e. f. Depreciation of factory equipment was $49,500; of office equipment, $61,800; and of office building, $14,900. Entry Description Debit Credit f. g. Factory overhead costs applied to jobs, $568,500. Entry Description Debit Credit g. h. Jobs completed, $1,500,000. Entry Description Debit Credit h. i. Cost of goods sold, $1,375,000. Entry Description Debit Credit i.

Answer 1

SOLUTION:

	Particulars	Debit	Credit
a	Materials	770,000
	Accounts payable		770,000
b	Work in Process	604,200
	Factory overhead	75,800
	Materials		680,000
c	Work in Process	574,000
	Factory overhead	182,000
	Wages payable		756,000
d	Factory overhead	245,000
	Selling Expenses	171,500
	Administrative Expenses	110,600
	Accounts payable		527,100
e	Factory overhead	24,500
	Selling Expenses	28,420
	Administrative Expenses	16,660
	Prepaid expenses		69,580
f	Factory overhead	49,500
	Depreciation expense-Office equipment	61,800
	Depreciation expense-Office building	14,900
	Accumulated depreciation- Building and Equipment		126,200
g	Work in Process	568,500
	Factory overhead		568,500
h	Finished goods	1,500,000
	Work in Process		1,500,000
i	Cost of goods sold	1,375,000
	Finished goods		1,375,000