The cost of materials transferred into the Bottling Department of Mountain Sprin
ID: 2446201 • Letter: T
Question
The cost of materials transferred into the Bottling Department of Mountain Springs Water Company is $32,400, with $26,000 from the Purifying Department, plus an additional $6,400 from the materials storeroom. The conversion cost for the period in the Bottling Department is $8,750 ($3,750 factory applied and $5,000 direct labor.) The total costs transferred to finished goods for the period were $31,980. The Bottling Department had a beginning inventory of $1,860. Hide a. Journalize (1) the cost of transferred-in materials (2) conversion costs, and (3) the cost transferred out to finished goods. For a compound transaction, if an amount box does not require an entry, leave it blank or enter "0". b. Determine the balance of Work in Process-Bottling at the end of the period. $
Explanation / Answer
Bottling dept Costs Amt $ Beginning Inventory 1,860 Materials costs Add Material_purifying 26,000 Stores Materials 6,400 Conversion costs Direct Labor 5,000 Fact OH applied 3,750 Total Production cost 43,010 Transferred out to FG 31,980 WIP in Bottling 11,030 Journal Entry Account Dr $ Cr $ 1 Materials transfer In WIP Bottling (Materials) 26,000 Transfer out Purify to Bottling 26,000 ( materials trsfd from Purifying to bottling) Inventory 6,400 WIP Bottling (Materials) 6,400 (Materials issue from stores) 2 Coversion costs WIP Bottling (direct labor) 5,000 Direct wages Payable 5,000 (direct labor cost ) WIP Bottling (Overhead applied) 3,750 Overhead Control A/C 3,750 (OH applied) 3 Transfer Out Finished Goods 31,980 WIP Bottling 31,980 WIP in bottling at month end is $ 11,030.00
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