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Paradise Company manufactures its product through two manufacturing processes: Assembly and Finishing. The company uses a process cost accounting system. Prepare the journal entries for
Paradise Company manufactures its product through two manufacturing processes: Assembly and Finishing. The company uses a process cost accounting system. Prepare the journal entries for the following transactions using the Chart of Accounts:
No. | Transactions |
---|---|
1. | Purchased $93,000 of raw materials on account. |
2. | Finished goods costing $130,000 were sold for $200,000 cash. |
Assets | Liabilities | Stockholders' Equity |
Cash | Accounts Payable | Common Stock |
Accounts Receivable | Unearned Revenue | Retained Earnings |
Raw Materials Inventory | Factory Wages Payable | Sales Revenue |
Work in Process Inventory-Assembly | Notes Payable | Cost of Goods Sold |
Work in Process Inventory-Finishing | Employer Payroll Taxes Payable | Selling Expense |
Factory Labor | Employer Fringe Benefits Payable | Supplies Expense |
Manufacturing Overhead | Taxes Payable | Utilities Expense |
Finished Goods Inventory | Interest Payable | Depreciation Expense |
Supplies | Insurance Expense | |
Prepaid Insurance | ||
Equipment | ||
Building | ||
Land | ||
Accumulated Depreciation |
- List debit transactions first and then list credit transactions.
- Use accounts provided in the Chart of Accounts above. Do NOT create your own account. Do NOT use any abbreviations.
- When typing your responses, do NOT include a dollar sign. For example, if your answer is $10,000, you should be typing 10,000 or 10,000.00 without any dollar sign.
Account Titles and Explanation | Debit ($) | Credit ($) |
---|---|---|
To record purchase of raw materials | ||
To record sale of merchandise | ||
To record cost of merchandise sold |
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