Question
Entries for Process Cost System Preston & Grover Soap Company manufactures powdered detergent. Phosphate is placed in process in the Making Department, where it is
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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. 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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