Question 8 Kirk Manufacturing Company has two production departments: Cutting an

Question

Question 8 Kirk Manufacturing Company has two production departments: Cutting and Assembly. July 1 inventories are Raw Materials $4,195, Work in Process-Cutting $3,166, Work in Process-Assembly $10,505, and Finished Goods $31,303. During July, the following transactions occurred. Purchased $62,915 of raw materials on account. Incurred $56,229 of factory labor. (Credit Wages Payable.) Incurred $70,007 of manufacturing overhead; $39,645 was paid and the remainder is unpaid. Requisitioned materials for Cutting $15,690 and Assembly $8,511. Used factory labor for Cutting $28,785 and Assembly $26,986. Applied overhead at the rate of $16 per machine hour. Machine hours were Cutting 1,497 and Assembly 2,124. Transferred goods costing $67,741 from the Cutting Department to the Assembly Department. Transferred goods costing $134,900 from Assembly to Finished Goods. Sold goods costing $150,012 for $200,433 on account. Instructions Journalize the transactions. (For multiple debit/credit entries, list amounts from largest to smallest e.g. 10, 5, 3, 2.) Description/Account Debit Credit 1. 62915 62915 2. 56229 56229 3. 70007 39645 30362 4. 5. 6. 7. 8. 9. 150012 150012 (To record cost of goods sold.) 200433 200433 (To record sales.)

Explanation / Answer

Account Title and explanations Debit($) Credit($) Raw material Inventory 62915 Accounts payable 62915 (Purchased raw materials on account) Work in Process 56229 Wages payable 56229 (Incurred of factory labor) Manufacturing Overhead 70007 Cash 39645 Accounts payable 30362 (Manufacturing overhead recorded) Work in process-cutting 15690 work in process-accembly 8511 Raw material inventory 24201 (Requisitioned materials for Cutting and Assembly) Work in process-cutting 28785 work in process-accembly 26986 Wages Payable 55771 ( Used factory labor for Cutting and Assembly) Work in process-cutting 23952 work in process-accembly 33984 Manufacturing overhead 57936 (manufacturing overhead applied) Work in process - assembly 67741 work in process - cutting 67741 (Transferred goods costing from the Cutting Department to the Assembly Department) Finished Goods 134900 Work in process-Assembly 134900 (Transferred goods costing $134,900 from Assembly to Finished Goods) Cost of goods sold 150012 Finished goods 150012 (sold goods costing $150012) Accounts receivable 200433 Sales 200433 (Sold goods on account)

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