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	$22,510
Work in ProcessMaking	8,750
Work in ProcessPacking	11,400
Materials	4,940

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		$280,360
b.	Materials requisitioned for use:
		PhosphateMaking Department	$185,200
		PackagingPacking Department	64,420
		Indirect materialsMaking Department	7,250
		Indirect materialsPacking Department	2,600
c.	Labor used:
		Direct laborMaking Department	$132,310
		Direct laborPacking Department	89,300
		Indirect laborMaking Department	25,620
		Indirect laborPacking Department	45,930
d.	Depreciation charged on fixed assets:
		Making Department	$24,160
		Packing Department	19,950
e.	Expired prepaid factory insurance:
		Making Department	$4,580
		Packing Department	1,830
f.	Applied factory overhead:
		Making Department	$63,140
		Packing Department	69,760
g.	Production costs transferred from Making Department to Packing Department		$381,740
h.	Production costs transferred from Packing Department to Finished Goods		$600,790
i.	Cost of goods sold during the period		$602,990

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. If required, use the minus sign to indicate a credit balance.

Factory OverheadMaking Department	$
Factory OverheadPacking Department	$