Schrager Company has two production departments: Cutting and Assembly. July 1 in
ID: 2427725 • Letter: S
Question
Schrager Company has two production departments: Cutting and Assembly. July 1 inventories are Raw Materials $4,950, Work in Process—Cutting $3,410, work in Process—Assembly $11,380, and Finished Goods $32,240. During July, the following transactions occurred.
Journalize the transactions. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)
No.
Account Titles and Explanation
Debit
Credit
1.
2.
3.
4.
5.
6.
7.
8.
9.
1. Purchased $63,160 of raw materials on account. 2. Incurred $61,420 of factory labor. (Credit Wages Payable.) 3. Incurred $71,220 of manufacturing overhead; $42,160 was paid and the remainder is unpaid. 4. Requisitioned materials for Cutting $17,510 and Assembly $9,370. 5. Used factory labor for Cutting $34,380 and Assembly $27,040. 6. Applied overhead at the rate of $20 per machine hour. Machine hours were Cutting 1,690 and Assembly 1,790. 7. Transferred goods costing $69,130 from the Cutting Department to the Assembly Department. 8. Transferred goods costing $135,720 from Assembly to Finished Goods. 9. Sold goods costing $151,900 for $201,040 on account.Explanation / Answer
No.
Account titles & explanation
Debit
credit
Purchase A/c Dr.
To Party A/c
(Being raw material purchased)
63160
63160
Wages A/c Dr.
To wages payable
(Being wages booked)
61420
61420
Manufacturing Overhead Dr.
71220
To Bank A/c
42160
To Party A/c
29060
(being Overhead incurred)
Work in progess Cutting
Work in progress assembly
To purchase A/c
(Being Material used)
17510
9370
26880
Work in progess Cutting
Work in progress assembly
To Wages A/c
(Being Wages used)
34380
27040
61420
Work in progess Cutting
Work in progress assembly
To Manufacturing Overhead A/c
(being Overhead applied)
33800
35800
69600
Work in progess Assembly
To Work in progress cutting
(being goods transferred from cutting department to assembly department)
69130
69130
Finished goods A/c Dr.
To WIP Assembly
(being Goods completed)
135720
135720
Party A/C Dr.
To finished goods A/c
To profit
(Being goods sold)
201400
151900
49500
No.
Account titles & explanation
Debit
credit
Purchase A/c Dr.
To Party A/c
(Being raw material purchased)
63160
63160
Wages A/c Dr.
To wages payable
(Being wages booked)
61420
61420
Manufacturing Overhead Dr.
71220
To Bank A/c
42160
To Party A/c
29060
(being Overhead incurred)
Work in progess Cutting
Work in progress assembly
To purchase A/c
(Being Material used)
17510
9370
26880
Work in progess Cutting
Work in progress assembly
To Wages A/c
(Being Wages used)
34380
27040
61420
Work in progess Cutting
Work in progress assembly
To Manufacturing Overhead A/c
(being Overhead applied)
33800
35800
69600
Work in progess Assembly
To Work in progress cutting
(being goods transferred from cutting department to assembly department)
69130
69130
Finished goods A/c Dr.
To WIP Assembly
(being Goods completed)
135720
135720
Party A/C Dr.
To finished goods A/c
To profit
(Being goods sold)
201400
151900
49500
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