Lubricants, Inc., produces a special kind of grease that is widely used by race car drivers. The grease is produced in two processing departments-Refining and Blending. Raw materials are introduced at various points in the Refining Department. The following incomplete Work in Process account is available for the Refining Department for March: Work in Process-Refining Department March 1 balance Completed and transferred to Blending 31,200 Materials 140,600 74,200 473,000 Direct labor Overhead March 31 balance The March 1 work in process inventory in the Refining Department consists of the following elements: materials, $8,000; direct labor $3,300; and overhead, $19,900 Costs incurred during March in the Blending Department were: materials used, $46,000; direct labor, $16,100; and overhead cost applied to production, $117,000. Required: 1. Prepare journal entries to record the costs incurred in both the Refining Department and Blending Department during March. Key your entries to the items (a) through (g) below. a. Raw materials used in production. b. Direct labor costs incurred c. Manufacturing overhead costs incurred for the entire factory, $716,000. (Credit Accounts Payable.) d. Manufacturing overhead was applied to production using a predetermined overhead rate. e. Units that were complete with respect to processing in the Refining Department were transferred to the Blending Department, $662,000. f. Units that were complete with respect to processing in the Blending Department were transferred to Finished Goods, $740,000. g. Completed units were sold on account, $1,430,000. The Cost of Goods Sold was $690,000 2. Post the journal entries from (1) above to T-accounts. The following account balances existed at the beginning of March. (The beginning balance in the Refining Department's Work in Process is given in the T-account shown above.) $213,600 $ 45,000 $ 24,000 Raw materials Work in process-Blending Department Finished goods Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare journal entries to record the costs incurred in both the Refining Department and Blending Department during March. Key your entries to the items (a) through (g) below. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet 1 2 3 4 5 6 8 Record issuance of raw materials to Refining and Blending Department. Note: Enter debits before credits. General Journal Transactions Debit Credit a. Complete this question by entering your answers in the tabs below. Required 2 Required 1 Post the journal entries from Requirement 1 to T-accounts. Accounts Receivable Raw Materials Beg. Bal. Beg. Bal. End. Bal. End. Bal. 0 Work in Process-Refining Department Work in Process-Blending Department Beg. Bal. Beg. Bal. End. Bal. 0 End. Bal Finished Goods Manufacturing Overhead Beg. Bal. Beg. Bal. 0 End. Bal End. Bal. 0 Accounts Payable Salaries and Wages Payable Beg. Bal. Beg. Bal. End. Bal. End. Bal. Sales Cost of Goods Sold Beg. Bal. Beg. Bal. End. Bal. End. Bal. Required 1 Required 2
