Present entries to record the following summarized operations related to product

Question

Present entries to record the following summarized operations related to production for a company using a job order cost system:

If an amount box does not require an entry, leave it blank.

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(a) Materials purchased on account $176,000 (b) Prepaid expenses incurred on account 12,200 (c) Materials requisitioned:      For production orders 153,700      For general factory use 2,700 (d) Factory labor used:      On production orders 141,300      For general factory purposes 12,000 (e) Depreciation on factory equipment 37,000 (f) Expiration of prepaid expenses, chargeable to factory 6,100 (g) Factory overhead costs incurred on account 76,000 (h) Factory overhead applied, based on machine hours 105,300 (i) Jobs finished 415,300 (j) Jobs shipped to customers: Cost 412,000       Selling price (assume all sold on account) 638,000

Explanation / Answer

Journal Entries: S.no. Accounts title and explanations Debit $ Credit $ a Raw material Inventory Dr. 176,000      Accounts payable 176000 b. Prepaid expense Dr. 12,200      Accounts payable 12,200 c. Work in process Inventory Dr. 153700 Factory Overheads Dr. 2700      Raw material Inventory 156400 d. Work in process Inventory Dr. 141300 Factory Overheads Dr. 12000       Factory Wages 153300 e. Factory Overheads Dr. 37000      Accumulated Depreciation 37000 f. Factory Overheads Account Dr. 6100      Prepaid expense Account 6100 g. Factory Overheads Account Dr. 76000       Accounts payable 76000 h. Work in process Inventory Dr. 105300        Factory Overheads 105300 i. Finished Goods Inventory Dr. 415300      Work in process Inventory 415300 j. Cost of Goods sold Dr. 412000     Finished Goods Inventory 412000 Accounts receivable Dr. 638000       Sales revenue 638000

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