Job Cost Journal Entries
Prior to the beginning of 2016, Lowe Company estimated that it would incur $440,000 of manufacturing overhead cost during 2016, using 40,000 direct labor hours to produce the desired volume of goods. On January 1,2016, beginning balances of Materials Inventory, Work in Process Inventory, and Finished Goods Inventory were $70,000, $-0-, and $107,500, respectively.
Question 1 Partially correct Mark 0.67 out of 1.00 P Flag question Job Cost Journal Entries Prior to the beginning of 2016, Lowe Company estimated that it would incur $440,000 of manufacturing overhead cost during 2016, using 40,000 direct labor hours to produce the desired volume of goods. On January 1, 2016, beginning balances of Materials inventory, Work in Process inventory, and finished Goods Inventory were $70,000,5-0, and $107.500, respectively Required Prepare general journal entries to record the following for 2016. a. Purchased materials on account, 597,500 Description Debit Credit Materials inventory 97,500 Accounts payable 97,500 b. Of the total dollar value of materials used, 577,500 represented direct material and $27.500 indirect material, Support Description De Credit Work in process inventory OX 0 Manufacturing overhead OM Materials inventory 0 Ox c. Determined total factory labor, 5337,500 (37,500 hrs. 59/hr.). d. Of the factory labor, 80% was direct and 20% indirect. Description Debit Credit Work in process inventory Manufacturing overhead Wapes payable OX e. Applied manufacturing overhead based on direct labor hours to work in process. Debit Credit Description Work in process inventory 2 Wages payable O OX e. Applied manufacturing overhead based on direct labor hours to work in process. Debit OX Description Credit Work in process inventory Manufacturing overhead 1. Determined actual manufacturing overhead other than those items already recorded, $230,000. (Credit Accounts Payable.) Description Debit Credit Manufacturing overhead . Accounts payable g. Ending inventories of work in process and finished goods were $80,000 and 5142,500, respectively. Determine the cost of finished goods (credit WIP) and the cost of goods sold (credit FG invent Description Debit Credit Finished goods inventory OX Work in process inventory Description Debit Credit Cost of goods sold OX Finished goods inventory 0 h. Transferred the balance in Manufacturing Overhead to Cost of Goods Sold Credit Description Manufacturing overhead Cost of goods sold Debit ON 0 Check You have correctly selected 33
