1 /courses/BACC230 1-1-173/Assignment%201.pdf 214 QUESTION 3 Crawford Corporatio

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1 /courses/BACC230 1-1-173/Assignment%201.pdf 214 QUESTION 3 Crawford Corporation incurred the following transactions. Purchased raw materials on account $66,300. Raw materials of $56,000 were requisitioned to the factory. An analysis of the materials requisition slips indicated that $6,800 was classified as indirect materials. Factory labor costs incurred were $79,900, of which $71,000 pertained to factory wages payable and $8,900 pertained to employer payroll taxes payable. Time tickets indicated that $54,000 was direct labor and $2,900 was indirect labor. Manufacturing overhead costs incurred on account were $85,500. Manufacturing overhead was applied at the rate of 150% of direct labor cost. Goods costing $98,000 were completed and transferred to finished goods. Finished goods costing $73,000 to manufacture were sold on account for $110,000. 1. 2. 3. 4. 5. 6. 7. 8. Instructions: Prepare entries to record the operations summarized above. QUESTION 4 Panda Corporation incurred the following transactions. 1. Cash purchases of raw materials costing $40,000. 2. Raw materials of $20,000 were requisitioned to the factory. An analysis of the materials requisition slips indicated that $5,000 was classified as indirect materials. 3. Factory labor costs incurred were $30,000, of which $25,500 pertained to factory wages payable and $4,500 pertained to employer payroll taxes payable. 4. Time tickets indicated that $54,000 was direct labor and $5,900 was indirect labor.

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Solution 3:

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Journal Entries - Crawford Corporation Event Particulars Debit Credit 1 Raw material inventory Dr $66,300.00             To Accounts payable $66,300.00 (To record purchase of raw material on account) 2 Work In Process Dr $49,200.00 Manufacturing overhead Dr $6,800.00             To Raw material inventory $56,000.00 (To record consumption of material into production) 3 Factory Wages Dr $79,900.00             To Factory wages payable $71,000.00             To Payroll tax payable $8,900.00 (To record labor cost incurred) 4 Work In Process Dr $54,000.00 Manufacturing overhead Dr $2,900.00             To Factory Wages $56,900.00 (Being direct and indirect labor cost charged to production) 5 Manufacturing overhead Dr $85,500.00             To Accounts payable $85,500.00 (To record MOH incurred) 6 Work In Process Dr ($54,000 * 150%) $81,000.00             To Manufacturing overhead $81,000.00 (Being manufacturing overhead applied to production) 7 Finished goods inventory Dr $98,000.00             To Work In Process $98,000.00 (Being cost of goods completed tranferred to finished goods inventory) 8a Accounts receivables Dr $110,000.00             To Sales Revenue $110,000.00 (To record sales on account) 8b Cost of goods sold Dr $73,000.00             To Finished goods inventory $73,000.00 (Being cost of inventory sold transferred to COGS)

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