Q2: Sanad Company had the following account balances as of August 1, 2021:

Raw Material (direct and indirect) Inventory $27,000

Work in Process Inventory 12,000

Finished Goods Inventory 20,000

Note: each student used different beginning balances for raw material, work in process inventory, and finished goods inventory

During August, the company incurred the following factory costs:

1. Purchased $350,000 of raw material on account.

2. Issued $220,000 of raw material to production, of which $134,000 was for direct materials.

3. Accrued $120,000 in factory payroll costs; $82,000 was for direct labor and the rest was

for supervisors salaries.

4. Accrued $15,000 of utility costs; of this amount, $5,600 was fixed.

5. Accrued $7,000 of property taxes on the factory.

6. Recorded the expiration of $4,600 of prepaid insurance on factory equipment.

7. Recorded $48,000 of straight-line depreciation on factory equipment.

8. Applied actual overhead to Work in Process Inventory.

9. Transferred goods costing $350,000 to Finished Goods Inventory.

10. Recorded total sales of $800,000; of these, $550,000 were on account.

11. Recorded cost of goods sold of $350,000.

12. Recorded selling and administrative costs of $320,000 (credit Various accounts).

Required:

a. Journalize the transactions for August.

b. Post transactions to T-accounts for Raw Material Inventory, Work in Process Inventory,

Finished Goods Inventory, and Cost of Goods Sold.

c. Prepare a schedule of cost of goods manufactured and cost of goods sold for August.