Question
Fire Out Company manufactures its product, Vitadrink, through two manufacturing processes: Mixing and Packaging. All materials are entered at the beginning of each process. On
Fire Out Company manufactures its product, Vitadrink, through two manufacturing processes: Mixing and Packaging. All materials are entered at the beginning of each process. On October 1, 2020, inventories consisted of Raw Materials $26,000, Work in ProcessMixing $0, Work in ProcessPackaging $250,000, and Finished Goods $289,000. The beginning inventory for Packaging consisted of 10,000 units that were 50% complete as to conversion costs and fully complete as to materials. During October, 50,000 units were started into production in the Mixing Department and the following transactions were completed.
1. | Purchased $300,000 of raw materials on account. | |
2. | Issued raw materials for production: Mixing $210,000 and Packaging $45,000. | |
3. | Incurred labor costs of $278,900. | |
4. | Used factory labor: Mixing $182,500 and Packaging $96,400. | |
5. | Incurred $810,000 of manufacturing overhead on account. | |
6. | Applied manufacturing overhead on the basis of $23 per machine hour. Machine hours were 28,000 in Mixing and 6,000 in Packaging. | |
7. | Transferred 45,000 units from Mixing to Packaging at a cost of $979,000. | |
8. | Transferred 53,000 units from Packaging to Finished Goods at a cost of $1,315,000. | |
9. | Sold goods costing $1,604,000 for $2,500,000 on account. |
Journalize the October transactions.
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