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 Inventory $ 51, 000 133, 500 153, 300 38,100 Ending Inventory $ 61,000 105,500 88, 400 26,250 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 $70,000 24,000 Direct labor Direct labor-Cutting Direct labor-Stitching Total factory payroll paid (in cash) $ 20,100 80, 400 157,300 Factory Overhead (Actual costs) Indirect materials used Indirect labor used Other overhead costs $ 36,000 56,800 56,000 Factory Overhead Rates Cutting (150% of direct materials used) Stitching (120% of direct labor used) $616,000 Sales lequired: . Compute the amount of (a) production costs transferred from Cutting to Stitching. (b) production costs transferred from Stitching to inished goods, and (c) cost of goods sold. Raw Materials (RM) Work in Process ( WP). Cutting Work in Process (WIP) - Stitching Factory Wages Payable Factory Overhead Finished Goods (FG) Required information Work in Process (WIP) - Stitching Factory Wages Payable Factory Overhead Finished Goods (FG) Income Statement (Partial) Cost of goods transferred to Finished Goods Cost of goods sold Problem 16-1A Part 2 2. Prepare summary journal entries dated May 31 to record the following production activities during May: (a) raw materials purchases, (b) direct materials usage, (c) indirect materials usage, (d) direct labor costs incurred. (e) indirect labor costs incurred. (1) payment of factory payroll (9) other overhead costs, (credit Other Accounts), (h) overhead applied, (l) goods transferred from Cutting to Stitching, () goods transferred from Stitching to finished goods, (k) cost of goods sold, and () sales. View transaction list Journal entry worksheet 2 3 4 5 6 7 8 ..... 12 Record purchase of raw materials. Note: Enter debits before credits Debit General Journal Date Credit May 31