Entries for Costs in a Job Order Cost System Royal Technology Company uses a job

Question

Entries for Costs in a Job Order Cost System Royal Technology Company uses a job order cost system. The following data summarize the operations related to production for March: Materials purchased on account, $770,000. Materials requisitioned, $680,000, of which $75,800 was for general factory use. Factory labor used, $756,000, of which $182,000 was indirect. Other costs incurred on account for factory overhead, $245,000; selling expenses, $171,500; and administrative expenses, $110,600. Prepaid expenses expired for factory overhead, $24,500; for selling expenses, $28,420; and for administrative expenses, $16,660. Depreciation of factory equipment was $49,500; of office equipment, $61,800; and of office building, $14,900. Factory overhead costs applied to jobs, $568,500. Jobs completed, $1,500,000. Cost of goods sold, $1,375,000. Required: Journalize the entries to record the summarized operations. For a compound transaction, if an amount box does not require an entry, leave it blank. a. Materials purchased on account, $770,000. Entry Description Debit Credit a. b. Materials requisitioned, $680,000, of which $75,800 was for general factory use. Entry Description Debit Credit b. c. Factory labor used, $756,000, of which $182,000 was indirect. Entry Description Debit Credit c. d. Other costs incurred on account for factory overhead, $245,000; selling expenses, $171,500; and administrative expenses, $110,600. Entry Description Debit Credit d. e. Prepaid expenses expired for factory overhead, $24,500; for selling expenses, $28,420; and for administrative expenses, $16,660. Entry Description Debit Credit e. f. Depreciation of factory equipment was $49,500; of office equipment, $61,800; and of office building, $14,900. Entry Description Debit Credit f. g. Factory overhead costs applied to jobs, $568,500. Entry Description Debit Credit g. h. Jobs completed, $1,500,000. Entry Description Debit Credit h. i. Cost of goods sold, $1,375,000. Entry Description Debit Credit i.

Explanation / Answer

SOLUTION:

Particulars Debit Credit a Materials 770,000 Accounts payable 770,000 b Work in Process 604,200 Factory overhead 75,800 Materials 680,000 c Work in Process 574,000 Factory overhead 182,000 Wages payable 756,000 d Factory overhead 245,000 Selling Expenses 171,500 Administrative Expenses 110,600 Accounts payable 527,100 e Factory overhead 24,500 Selling Expenses 28,420 Administrative Expenses 16,660 Prepaid expenses 69,580 f Factory overhead 49,500 Depreciation expense-Office equipment 61,800 Depreciation expense-Office building 14,900 Accumulated depreciation- Building and Equipment 126,200 g Work in Process 568,500 Factory overhead 568,500 h Finished goods 1,500,000 Work in Process 1,500,000 i Cost of goods sold 1,375,000 Finished goods 1,375,000

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