question archive a) Raw materials were purchased on account, $180,000
a) Raw materials were purchased on account, $180,000
Subject:AccountingPrice: Bought3
a) Raw materials were purchased on account, $180,000.
b) Raw materials used in production, $148,000 ($130,000 direct materials and $18,000 indirect
materials).
c) Accrued direct labor cost of $75,000 and indirect labor cost of $105,000.
d) Depreciation recorded on factory equipment, $40,000.
e. Other manufacturing overhead costs accrued during April, $118,000.
f. The company applies manufacturing overhead cost to production using a predetermined
overhead rate of $6 per machine-hours. A total of 46,000 machine-hours were used in April.
g. Jobs costing $495,000 according to their job cost sheets were completed during April and
transferred to Finished Goods.
h. Jobs that had cost $450,000 to complete according to their job cost sheets were shipped to
customers during the month. These jobs were sold on account at 30% above cost.
Required:
1. Prepare journal entries to record the transactions given above.
2. Prepare T-accounts for Manufacturing Overhead and Work in Process. Post the relevant
transactions from above to each account. Compute the ending balance in each account,
assuming that Work in Process has a beginning balance of $39,000.
