Entries for Process Cost System Preston & Grover Soap Company manufactures powde

Question

Entries for Process Cost System

Preston & Grover Soap Company manufactures powdered detergent. Phosphate is placed in process in the Making Department, where it is turned into granulars. The output of Making is transferred to the Packing Department, where packaging is added at the beginning of the process. On July 1, Preston & Grover Soap Company had the following inventories:

Departmental accounts are maintained for factory overhead, which both have zero balances on July 1.

Manufacturing operations for July are summarized as follows:

Required:

1. Journalize the entries to record the operations, identifying each entry by letter. For a compound transaction, if an amount box does not require an entry, leave it blank.

2. Compute the July 31 balances of the inventory accounts.

3. Compute the July 31 balances of the factory overhead accounts. If required, use the minus sign to indicate a credit balance.

Finished Goods $29,770 Work in Process—Making 11,570 Work in Process—Packing 15,080 Materials 6,530

Explanation / Answer

2.  

3.

1) Journal entries: Date Account titles and Explanations Debit Credit a Materials 370,740 Accounts payable 370,740 (materials bought on account) b WIP Making department 244,900 WIP Packing department 85,180 Factory OH - Making department 9,580 Factory OH - Packing department 3,440 Materials 343,100 (materials issued for production) c WIP Making department 174,970 WIP Packing department 118,100 Factory OH - Making department 33,880 Factory OH - Packing department 60,740 Wages payable 387,690 (labor cost incurred) d Factory OH - Making department 31,940 Factory OH - Packing department 26,380 Accumulated depreciation-Factory 58,320 (depreciation for the month) e Factory OH - Making department 6,050 Factory OH - Packing department 2,420 Prepaid insurance 8,470 (Expired insurance) f WIP Making department 83,490 WIP Packing department 92,250 Factory OH - Making department 83,490 Factory OH - Packing department 92,250 (OH applied to production) g WIP Packing department 504,810 WIP Making department 504,810 (transfer of production) h Finished goods 794,490 WIP Packing department 794,490 (finished goods transferred) i Cost of goods sold 797,390 Finished goods 797,390 (cost of goods sold accounted)

Related Questions

Navigate

• Browse (All)
• Browse E
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.