Entries for Process Cost System

Preston & Grover Soap Company manufactures powdered detergent. Phosphate is placed in process in the Making Department, where it is turned into granulars. The output of Making is transferred to the Packing Department, where packaging is added at the beginning of the process. On July 1, Preston & Grover Soap Company had the following inventories:

1. Finished Goods	$11,070
   Work in ProcessMaking	4,300
   Work in ProcessPacking	5,610
   Materials	2,430

   Departmental accounts are maintained for factory overhead, which both have zero balances on July 1.

   Manufacturing operations for July are summarized as follows:

   a.	Materials purchased on account		$137,880
   b.	Materials requisitioned for use:
   		PhosphateMaking Department	$91,080
   		PackagingPacking Department	31,680
   		Indirect materialsMaking Department	3,560
   		Indirect materialsPacking Department	1,280
   c.	Labor used:
   		Direct laborMaking Department	$65,070
   		Direct laborPacking Department	43,920
   		Indirect laborMaking Department	12,600
   		Indirect laborPacking Department	22,590
   d.	Depreciation charged on fixed assets:
   		Making Department	$11,880
   		Packing Department	9,810
   e.	Expired prepaid factory insurance:
   		Making Department	$2,250
   		Packing Department	900
   f.	Applied factory overhead:
   		Making Department	$31,050
   		Packing Department	34,310
   g.	Production costs transferred from Making Department to Packing Department		$187,740
   h.	Production costs transferred from Packing Department to Finished Goods		$295,470
   i.	Cost of goods sold during the period		$296,550

   Required:

   1. Journalize the entries to record the operations, identifying each entry by letter. For a compound transaction, if an amount box does not require an entry, leave it blank.

   Item	Account	Debit	Credit
   a.
   b.
   c.
   d.
   e.
   f.
   g.
   h.
   i.

   2. Compute the July 31 balances of the inventory accounts.

   Materials	$
   Work in ProcessMaking Department	$
   Work in ProcessPacking Department	$
   Finished Goods	$

   3. Compute the July 31 balances of the factory overhead accounts.

   Factory OverheadMaking Department	$
   Factory OverheadPacking Department	$

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