Question
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
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) |
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