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Write Journal Entries For Business Transactions

Question

 

Chesapeake Sailmakers uses job order costing. Manufacturing overhead is charged to individual jobs through the use of a predetermined overhead rate based on direct labor costs. The following information appears in the company's Work in Process Inventory account for the month of June.

Debits to account:                                                                                                      

Balance, June 1                                                                                   $7,200                                    

Direct materials                                                                                  13,000                                    

Direct labor                                                                                         9,300                                    

Manufacturing overhead

(applied to jobs as 150% of direct labor costs)                                   13,000                                   

                                                                                                          

Total debits to account                                                                       $42,500                                  

                                                                       

Credits to account:                                                                                                     

           Transferred to Finished Goods Inventory account                 33,200                                  

Balance, June 30                                                                                 $9,300                                  

                                                                                                          

a) Assuming that the direct labor charged to the jobs still in process at June 30 amounts to $2,300, compute the amount of manufacturing overhead and the amount of direct materials that have been charged to these jobs as of June 30.                                                                                                          

Manufacturing overhead applied to jobs         $__________________

Direct materials charged to jobs                       $__________________

b) Prepare general journal entries to summarize:                                                                                

1. The manufacturing costs (direct materials, direct labor, and overhead) charged to production during June.      

2. The transfer of production completed during June to the Finished Goods Inventory account.   

3. The cash sale of 90 percent of the merchandise completed during June at a total sales price of $51,000. Show the related cost of goods sold in a separate journal entry.                                   

 

Summary

The question belongs to Accounts and it discusses about writing journal entries for some transactions of a business.

Total Word Count NA

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