Required:

1. Compute the amount of (a) production costs transferred from Cutting to Stitching, (b) production costs transferred from Stitching to finished goods, and (c) cost of goods sold.

Sierra Company manufactures soccer balls in two sequential processes: Cutting and Stitching. All direct materials enter production at the beginning of the Cutting process. The following information is available regarding its May inventories: Raw materials inventory Work in process inventory-Cutting Work in process inventory-Stitching Finished goods inventory Beginning Ending Inventory Inventory $21,000 $24,100 73,500 7 5,500 93,30069,800 26,100 14,250 The following additional information describes the company's production activities for May Direct materials Raw materials purchased on credit Direct materials used-Cutting Direct materials used-Stitching $ 40,000 22,500 Direct labor Direct labor-Cutting Direct labor-Stitching Total factory payroll paid (in cash) $ 17,100 68,400 141, 100 Factory Overhead (Actual costs) Indirect materials used Indirect labor used Other overhead costs $ 14,400 55,600 50,000 Factory Overhead Rates Cutting (150% of direct materials used) Stitching (1208 of direct labor used) Sales $376,000 Raw Materials (RM) C of GM - Cutting C of GM - Stitching Cost of goods sold Direct labor - Cutting Direct labor - Stitching ork in Process (WIP) - Stitching Factory Overhead Work in Process (WIP) - Cutting Direct materials - Cutting Direct materials - Stitching FG - April 30 FG - May 31 Factory War Indirect labor used Finished Goods (FG) Indirect materials used Other overhead costs Overapplied overhead - Cutting Overapplied overhead - Stitching RM - April 30 RM - May 31 RM purchases Sales Total factory payroll Underapplied overhead - Cutting Underapplied overhead - Stitching WIP - April 30 Total factory payroll Underapplied overhead - Cutting Underapplied overhead - Stitching WIP - April 30 WIP - May 31