Toledo Tile Company produces ceramic tile used in the housing industry. The process takes place in two sequential departments. The following cost data pertain to the month of October.

Required: 

Prepare journal entries to record the following events.
1. Incurrence of costs for direct material and direct labor and application of manufacturing overhead in the Preparation Department.
2. Transfer of goods from Preparation to Finishing.
3. Incurrence of costs for direct material and direct labor and application of manufacturing overhead in the Finishing Department.
4. Transfer of goods from the Finishing Department to finished-goods inventory.

Transcribed Image Text:

Direct material entered into production Direct labor Applied manufacturing overhead Cost of goods completed and transferred out *Cost of goods transferred to the Finishing Department. +Cost of goods transferred to finished goods. Preparation Department $ 105,000 510,000 Finishing Department $ 37,500 420,000 1,020,000 630,000 1,350,000* 600,000*