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 $23,370 Work in ProcessMaking 9,080 Work in ProcessPacking 11,840 Materials 5,130

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 $291,080 b. Materials requisitioned for use PhosphateMaking Department $192,280 PackagingPacking Department 66,880 Indirect materialsMaking Department 7,520 Indirect materialsPacking Department 2,700 c. Labor used Direct laborMaking Department $137,370 Direct laborPacking Department 92,720 Indirect laborMaking Department 26,600 Indirect laborPacking Department 47,690 d. Depreciation charged on fixed assets Making Department $25,080 Packing Department 20,710 e. Expired prepaid factory insurance Making Department $4,750 Packing Department 1,900 f. Applied factory overhead Making Department $65,550 Packing Department 72,430 g. Production costs transferred from Making Department to Packing Department $396,340 h. Production costs transferred from Packing Department to Finished Goods $623,770 i. Cost of goods sold during the period $626,050

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. e