Gardner Company produces 18-ounce boxes of a wheat cereal in three departments: mixing, cooking, and packaging. During August, Gardner produced 100,000 boxes with the following costs:

	Mixing	Cooking	Packaging
	Department	Department	Department
Direct materials	$412,500	$187,700	$164,200
Direct labor	59,200	37,800	90,000
Applied overhead	74,100	41,750	116,000

Required:

1.	Calculate the costs transferred out of each department.
2.	Prepare journal entries that reflect these cost transfers.

CHART OF ACCOUNTS

Gardner Company

General Ledger

	ASSETS
110	Cash
120	Accounts Receivable
130	Raw Materials
142	Work in Process-Cooking
143	Work in Process-Mixing
144	Work in Process-Packaging
150	Overhead Control
160	Finished Goods
180	Accumulated Depreciation

	LIABILITIES
210	Accounts Payable
220	Wages Payable
230	Utilities Payable
240	Lease Payable
250	Other Payables

	EQUITY
310	Common Stock
320	Retained Earnings

1. Calculate the costs transferred out of each department.

(a) Costs transferred out of the Mixing Department:

(b) Costs transferred out of the Cooking Department:

(c) Costs transferred out of the Packaging Department:

2. Prepare journal entries on Aug. 31 that reflect these cost transfers. Refer to the Chart of Accounts for the exact wording of account titles.

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GENERAL JOURNAL

	DATE	ACCOUNT TITLE	POST. REF.	DEBIT	CREDIT
1
2
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6