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Major League Bat Company manufactures baseball bats. In addition to its work in process inventories, the company maintains inventories of raw materials and finished goods.
Major League Bat Company manufactures baseball bats. In addition to its work in process inventories, the company maintains
inventories of raw materials and finished goods. It uses raw materials as direct materials in production and as indirect materials. Its
factory payroll costs include direct labor for production and indirect labor. All materials are added at the beginning of the process, and
conversion costs are applied uniformly throughout the production process.
Required:
You are to maintain records and produce measures of inventories to reflect the July events of this company. The June balances:
Raw Materials Inventory, $; Work in Process Inventory, $ $ of direct materials and $ of conversion; Finished.
Goods Inventory, $; Sales, $; Cost of Goods Sold, $; Factory Wages Payable, $; and Factory Overhead, $
Prepare journal entries to record the following July transactions and events.
a Purchased raw materials for $ cash.
b Used raw materials as follows: direct materials, $ and indirect materials, $
c Recorded factory wages payable costs as follows: direct labor, $ and indirect labor, $
d Incurred other actual factory overhead costs of $ paid in cash.
e Applied factory overhead to production at of direct labor costs.
Information about the July work in process WIP inventory follows. Use this information with that from part to prepare a
production cost report, assuming the weighted average method is used.
Units
Units Beginning WIP inventory
Started
Units transferred out
Ending WIP inventory
Beginning WIP inventory
Direct materialsPercent complete
ConversionPercent complete
Ending WIP inventory
Direct materialsPercent complete
ConversionPercent complete
Using the results from part and the available information, make computations and prepare journal entries to record the
following:
f Total costs transferred to finished goods for July.
g Sale of finished goods costing $ for $ in cash.
Post entries from parts and to the following general ledger accounts.
Compute the amount of gross profit from the sales in July.
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Post entries from parts and to the following general ledger accounts.
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