PR 17-1A Entries for process cost system Port Ormond Carpet Company manufactures carpets. Fiber is placed in process in the Spinning Department, where it is spun into yarn. The output of the Spinning Department is transferred to the Tufting Department, where carpet backing is added at the beginning of the process and the process is completed. On January 1, Port Ormond Carpet Company had the following inventories: Finished Goods $62,000 Work in Process-Spinning Department 35,000 Work in Process-Tufting Department 28,500 Materials 17,000 Departmental accounts are maintained for factory overhead, and both have zero balances on January 1. Manufacturing operations for January are summarized as follows: a. Materials purchased on account b. Materials requisitioned for use: Fibers-Spinning Department.. Carpet backing-Tufting Department... Indirect materials-Spinning Department... Indirect materials-Tufting Department.... c. Labor used: $500,000 $275,000 110,000 46,000 39,500 Departmental accounts are maintained for factory overhead, and both have zero balances on January 1. Manufacturing operations for January are summarized as follows: a. Materials purchased on account b. Materials requisitioned for use: Fibers-Spinning Department.. Carpet backing-Tufting Department... Indirect materials-Spinning Department.. Indirect materials-Tufting Department... c. Labor used: $500,000 $275,000 .110,000 46,000 39,500 Direct labor-Spinning Department.. Direct labor-Tufting Department.... $185,000 98,000 Indirect labor-Spinning Department. 18,500 Indirect labor-Tufting Department.. 9,000 d. Depreciation charged on fixed assets: spinning Department.. Tufting Department... e. Expired prepaid factory insurance: $12,500 8,500 Spinning Department... Tufting Department.. $2,000 1,000 f. Applied factory overhead: Spinning Department. $80,000 Tufting Department.. 55,000 g. Production costs transferred from Spinning Department to Tufting Department............$547,000 h. Production costs transferred from Tufting Department to Finished Goods. $807,200 1. Cost of goods sold during the period. $795,200 Instructions 1. Journalize the entries to record the operations, identifying each entry by letter. 2. Compute the January 31 balances of the inventory accounts. 3. Compute the January 31 balances of the factory overhead accounts