Overhead 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 31,100 Completed and transferred Materials to Blending 152,600 Direct labor 69,200 474,000 March 31 balance The March 1 work in process inventory in the Refining Department consists of the following elements: materials, $7,700, direct labor $3,100; and overhead, $20,300 Costs incurred during March in the Blending Department were materials used, $45,000; direct labor, 517,500; and overhead cost applied to production, $115,000. Required: 1. Prepato journal entries to record the costs incurred in both the Refining Department and Blending Pepartment during March Key your entries to the items (a) through (g) below 7 a. Raw materials used in production b. Direct labor costs incurred. Manufacturing overhead costs incurred for the entire factory, $646,000. (Credit Accounts Payoble) 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 $672,000 Units that were complete with respect to processing in the Blending Department were transferred to Finished Goods, $ 710,000 9. Completed units were sold on account, $1,340.000 The Cost of Goods Sold was $630,000 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) 2. Post the journal entries from (1) above to T-accounts. The following account balances existed at the beginning of March. IThe beginning balance in the Refining Department's Work in Process is given in the T-account shown above.) Raw materials Work in process-Blending Department Finished goods $288,600 $ 46,000 $ 24,000 Journal entry worksheet 1 2 3 8 4 5 6 7 Record direct labor cost incurred for Refining and Blending Department. Note: Enter debits before credits General Journal Debit Credit Transactions b. Record manufacturing expenses incurred for the whole factory. Note: Enter debits before credits. Transactions General Journal Debit Credit C. Record entry to apply overhead cost to production at a predetermined rate to the Refining Department and Blending Department. Note: Enter debits before credits. Debit Credit Transactions General Journal d. Record transfer of semi finished units from Refining to Blending Department. Note: Enter debits before credits. Transactions General Journal Debit Credit e. Journal entry worksheet Record the transfer of completed units from the Blending Department to finished goods. Note: Enter debits before credits. General Journal Debit Credit Transactions f. Journal entry worksheet
