Requirement 1. Journalize the transactions for the company. (Record debits first, then credits. Exclude explanations from any journal entries.)

a. Collections on account, $140,000

Date			Accounts	Debit	Credit
a.			Cash	140,000
			Accounts Receivable		140,000

b. Selling and administrative expenses incurred and paid, $22,000

Date			Accounts	Debit	Credit
b.			Selling and Administrative Expenses	22,000
			Cash		22,000

c. Payments on account, $37,000

Date			Accounts	Debit	Credit
c.			Accounts Payable	37,000
			Cash		37,000

d. Materials purchased on credit: Paper,

$25,500;

indirect materials,

$4,100

(Prepare a single journal entry for this event.)

Date			Accounts	Debit	Credit
d.			Raw Materials Inventory	29,600
			Accounts Payable		29,600

e. Materials requisitioned and used in production: Job 120: Paper,

$900,

Job 121: Paper,

$7,700,

Indirect materials,

$1,000

(Prepare a single journal entry for this event.)

Date			Accounts	Debit	Credit
e.			Work-in-Process Inventory	8,600
			Manufacturing Overhead	1,000
			Raw Materials Inventory		9,600

f. Wages incurred during

June,

$42,000.

Labor time records for the month: Job 120,

$3,500;

Job 121,

$19,200;

indirect labor,

$19,300

(Prepare a single journal entry for this event.)

Date			Accounts	Debit	Credit
f.			Work-in-Process Inventory	22,700
			Manufacturing Overhead	19,300
			Wages Payable		42,000

g. Wages paid in

June

include the balance in the Wages Payable account at

May

31

plus

$40,200

of wages incurred in

June.

Date			Accounts	Debit	Credit
g.			Wages Payable	43,500
			Cash		43,500

h. Depreciation on plant and equipment, $2,800

Date			Accounts	Debit	Credit
h.			Manufacturing Overhead	2,800
			Accumulated Depreciation		2,800

i. Manufacturing overhead was allocated at the predetermined overhead allocation rate of

60%

of direct labor costs.

Date			Accounts	Debit	Credit
i.			Work-in-Process Inventory	13,620
			Manufacturing Overhead		13,620

j. Jobs completed during the month: Job 120,

500,000

Large Stars at total cost of $49,500

Date			Accounts	Debit	Credit
j.			Finished Goods Inventory	49,500
			Work-in-Process Inventory		49,500

k. Sales on account: all of Job 120 for $133,000

Begin by recording the revenue from the sales on account. Do not record the expense related to the sale in this journal entry. We will do that in the next step.

Date			Accounts	Debit	Credit
k.			Accounts Receivable	133,000
			Sales Revenue		133,000

Now record the cost of goods sold related to the sale of all of Job 120.

Date			Accounts	Debit	Credit
k.			Cost of Goods Sold	49,500
			Finished Goods Inventory		49,500

l. Adjusted for overallocated or underallocated manufacturing overhead.

Date			Accounts	Debit	Credit
l.			Cost of Goods Sold	9,480
			Manufacturing Overhead		9,480

Requirement 2. T-accounts for the general ledger, the Raw Materials Inventory subsidiary ledger, the Work-in-Process Inventory subsidiary ledger, and the Finished Goods Inventory subsidiary ledger have been opened for you along with each account's balance as given. Post the journal entries to the T-accounts using the transaction letters as a reference.

Begin with posting the transactions to the general ledger accounts. Key each transaction by transaction letter, and calculate the ending balance of each account. (Post each entry by entering only one debit or credit to each T-account affected by the transaction. For accounts with a zero balance, enter a "0" along with a "Bal." reference on the normal side of the T-account.)

Review the journal entries you prepared in Requirement 1.