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:

Finished Goods	$13,500
Work in ProcessMaking	6,790
Work in ProcessPacking	7,350
Materials	5,100

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		$149,800
b.	Materials requisitioned for use:
		PhosphateMaking Department	$105,700
		PackagingPacking Department	31,300
		Indirect materialsMaking Department	4,980
		Indirect materialsPacking Department	1,530
c.	Labor used:
		Direct laborMaking Department	$32,400
		Direct laborPacking Department	40,900
		Indirect laborMaking Department	15,400
		Indirect laborPacking Department	18,300
d.	Depreciation charged on fixed assets:
		Making Department	$10,700
		Packing Department	7,900
e.	Expired prepaid factory insurance:
		Making Department	$2,000
		Packing Department	1,500
f.	Applied factory overhead:
		Making Department	$32,570
		Packing Department	30,050
g.	Production costs transferred from Making Department to Packing Department		$166,790
h.	Production costs transferred from Packing Department to Finished Goods		$263,400
i.	Cost of goods sold during the period		$265,200

Required:

1. Journalize the entries to record the operations, identifying each entry by letter. 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	$