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Gardner Company produces 18-ounce boxes of a wheat cereal in three departments: mixing, cooking, and packaging. During August, Gardner produced 125,000 boxes with the following
Gardner Company produces 18-ounce boxes of a wheat cereal in three departments: mixing, cooking, and packaging. During August, Gardner produced 125,000 boxes with the following costs:
Mixing | Cooking | Packaging | |
Department | Department | Department | |
Direct materials | $413,400 | $188,200 | $165,800 |
Direct labor | 60,800 | 37,500 | 89,900 |
Applied overhead | 75,000 | 40,250 | 115,250 |
Required:
1. | Calculate the costs transferred out of each department. |
2. | Prepare journal entries that reflect these cost transfers. |
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