Finished Goods and Cost of Goods Sold Before the completed production for August

Question

Finished Goods and Cost of Goods Sold

Before the completed production for August is recorded, the work in process inventory account for Bayfield Company appears as follows:

Assume that completed production for August includes Jobs 317, 318, and 319 with total costs of $31,000, $18,000, and $22,000, respectively.

Work in Process Inventory Balance August 1 $15,000 Direct material 33,000 Direct labor 20,000 Manufacturing overhead applied 20,000 QUESTION 10 Partially correct Mark 12.00 out of 19.00P Flag question Finished Goods and Cost of Goods Sold Before the completed production for August is recorded, the work in process inventory account for Bayfield Company appears as follows: Work in Process Inventory Balance August 1 Direct material Direct labor Manufacturing overhead applied $15,000 33,000 20,000 20,000 Assume that completed production for August includes Jobs 317, 318, and 319 with total costs of $31,000, $18,000, and $22,000, respectively a. Determine the cost of unfinished jobs at August 31 and prepare a journal entry to record completed production. Work in process balance as of August 31: General Journal Description Debit Credit Finished goods inventory Work in process inventory b. Using general journal entries, record the sale of Job 317 for $45,000 on account. General Journal Description Debit Credit Cost of goods sold Finished goods inventory To transfer cost to expense Accounts receivable es To record sale of job 317

Explanation / Answer

Ending work in process inventory = (15000+33000+20000+20000-71000) = 17000

Journal entry :

Date accounts & explanation debit credit Finished goods inventory 71000    Work in process inventory 71000 (To record goods completed) Cost of goods sold 31000      Finished goods 31000 (To transfer cost to expense) Account receivable 45000      Sales revenue 45000 (To record sale of job 317)

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