Nihon, Inc., is a manufacturer of digital cameras. It has two departments: assembly and testing. In February 2012, the company incurred $850,000 on direct materials and $775,000 on conversion costs, for a total manufacturing cost of $1,600,000. During February 10,000 cameras are placed into production, but only 5,000 cameras are fully completed at the end of the month. All direct materials have been added to the remaining 5,000 cameras. Hovewer, on average, these remaining 5,000 cameras are only 50% complete as to conversion costs.

1. Prepare summary journal entries for the use of direct materials and incurrence of conversion costs. Also prepare a journal entry to transfer ou the cost of goods completed. Show the postings to the Work in Process account.

Requirement 1. Prepare summary journal entries for the use of direct materials and incurrence of conversion costs. (Record debits first, then credits. Explanations are not required. Begin by recording the purchase and use of direct materials. Journal Entry Date Accounts Debit Credit JE 1 Record the conve rsion costs. Journal Entry Date Accounts Debit Credit JE 2 Prepare sa journal entry to transfer out the cost of goods completed. Journal Entry Date Accounts Debit Credit JE 3 Show the postings to the Work in Process account. Work in Process Assembly Department Beg. bal End. bal