0 Required information Problem 15-3A Source documents, journal entries, and acco

Question

0 Required information Problem 15-3A Source documents, journal entries, and accounts in job or The following information applies to the questions displayed below) Widmer wa er craft's predetermined overhead rate for the year 2017 is 200% of direct labor Information on the der costing LO P1, P2, P3 production activities during May 2017 follows a. Purchased raw materials on credit, $220,000 b. Materials requistions record use of the following materials for the month Job 136 Job 137 Job 138 Job 139 Job 140 Total direct materials indirect material Total materials used 50,000 33,000 19,800 23,400 7,200 133,400 20, 000 153,400 c. Paid $16,000 cash to a computer consultant to reprogram factory equipment d. Time tickets record use of the following labor for the month. These wages were paid in cash Job 136 Job 137 Job 138 Job 139 Job 140 Total direct labor Indirect labor Total 12,200 10,500 7,700 39,200 3,000 102,600 21,000 126, 600

Explanation / Answer

Journal Entry

Note 1 - Job sheet

Transaction General Journal Debit Credit a. Raw Material Inventory $220000 Accounts Payable $220000 (Raw Material Purchased) b. Work In progress Inventory $133400 Factory Overhead $20000 Raw material Inventory $153400 (Raw Material used) c. Factory Overhead $15750 Cash $15750 (Factory overhead Paid) d. (1) Factory Payroll $126600 Cash $126600 (Factory payroll paid) d. (2) Goods in progress Inventory $102600 Factory Overhead $24000 Factory Payroll $126600 (Labour use in production) e. Goods in progress Inventory $178200 Factory Overhead $178200 (Overhead Applied) - ($12200 + $37700 + $39200)*200% = $178200 f. Finished Goods Inventory $360500 Goods in progress Inventory $360500 (Transferred to finished goods Inventory) ($86600 + 141000 + $132900 = $360500) (Note 1) g. (1) Accounts Receivable $535000 Sales $535000 (Sales of finished goods) g. (2) Cost of goods sold $219500 Finished Goods Inventory $219500 (Cost of goods sold segregated) - ($86600 + $132900) h. Factory Overhead $154500 Depreciation of factory building $68500 Depreciation of factory equipment $38000 Expired factory insurance $12000 Accrued property tax payable $36000 (overhead expenses transferred to factory overhead) i. Goods in process Inventory $27000 Factory Overhead $27000 (Overhead Applied) - ($10500 + $3000)*200%

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