Shamrock Industries uses process costing. All of the company\'s manufacturing ac

Question

Shamrock Industries uses process costing. All of the company's manufacturing activities take place in a single processing department. The following information was available for the month of June. Direct materials Direct labor Manufacturing overhead applied Total costs to account for in June $ 89,000 26,000 39,000 $ 154,000 The amounts of work in process at the beginning and end of the month were immaterial and assigned no dollar value. During June, 13,250 units were completed, of which 10,000 were sold on account at $25 per unit. a. Prepare a journal entry to summarize the total manufacturing costs applied to production in June. b. Prepare the journal entry to transfer completed units from work in process to the finished goods warehouse in June c. Prepare the journal entries to record the sale of 10,000 units manufactured during the period and the related cost of goods sold.

Explanation / Answer

a Work in Process inventory 154000        Direct materials 89000        Direct labor 26000        Manufacturing overhead 39000 b Finished goods inventory 154000       Work in Process inventory 154000 c Accounts receivable 250000 =10000*25       Sales revenue 250000 Cost of goods sold 116226 =154000/13250*10000      Finished goods inventory 116226

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