Cost Flows Through Journal Entries

The Mixing Department performs a series of processes in which a fluid chemical is concentrated. Records indicate that the Mixing Department has been charged with $50,000 of direct labor costs. The manufacturing overhead rate is 170% of direct labor costs. Beginning work in process was $170,000, and ending work in process totaled $36,000. One half of this periods completed products is sold on account at a price equal to 150% of its cost.

Prepare journal entries to record (1) various costs charged to the Mixing Department this period, (2) transfer of this periods completed product, and (3) sale of one-half of this periods production.

General Journal
Ref.	Description	Debit	Credit
(1)	Work in Progress
	Wages Payable
	(To record direct labor costs)
	Work In Progress
	Manufacturing Overhead
	(To record manufacturing overhead)
(2)	Finished Goods Inventory
	Work in Progress
	(To record completed production)
(3)	Cost of Goods Sold
	Finished Goods Inventory
	(To record cost of goods sold)
	Accounts Receivable
	Sales
	(To record this period's sales)