Sunset Products manufactures skateboards. The following transactions occurred in

Question

Sunset Products manufactures skateboards. The following transactions occurred in March 1. Purchased $23,000 of materials on account 2. Issued $1,300 of supplies from the materials inventory 3. Purchased $25,600 of materials on account. 4. Paid for the materials purchased in transaction (1) using cash 5. Issued $30,600 in direct materials to the production department. 6. Incurred direct labor costs of $28,000, which were credited to Wages Payable 7. Paid $22,100 cash for utilities, power, equipment maintenance, and other miscellaneous items for the manufacturing shop 8. Applied overhead on the basis of 115 percent of direct labor costs 9. Recognized depreciation on manufacturing property, plant, and equipment of $5,600 The following balances appeared in the accounts of Sunset Products for March Beginning Ending Materials Inventory Work-in-Process Inventory Finished Goods Inventory Cost of Goods Sold $ 9,900 17,100 65,600 $37,100 73,600 Required a. Prepare journal entries to record the transactions. (f no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Explanation / Answer

Transactions General Journal Debit Credit 1 Material Inventory $23000     Accounts Payable $23000 (To record purchase of direct materials on credit.) Transactions General Journal Debit Credit 2 Manufacturing Overhead Control $1300                                Material Inventory $1300 (To record supplies from materials inventory.) Transactions General Journal Debit Credit 3 Material Inventory $25600     Accounts Payable $25600 (To record purchase of direct materials on credit.) Transactions General Journal Debit Credit 4 Accounts Payable $23000                            Cash $23000 (To record payment made of material purchased.) Transactions General Journal Debit Credit 5 Work-in-process Inventory $30600                                Material Inventory $30600 (To record direct materials issued.) Transactions General Journal Debit Credit 6 Manufacturing Overhead Control $28000                                Wages Payable $28000 (To record direct labour cost incurred.) Transactions General Journal Debit Credit 7 Manufacturing Overhead Control $22100                                                      Cash $22100 (To record various expenses.) Transactions General Journal Debit Credit 8 Manufacturing Overhead Control $32200                       Applied Manufacturing Overhead $32200 (To record various expenses.) Transactions General Journal Debit Credit 9 Manufacturing Overhead Control $5600 Accumulated Depreciation-Property, Plant and Equipment $5600 (To record depreciation.) T-Accounts Material Inventory Beg. Balance $9,900 1 $23,000 2 $1,300 3 $25,600 5 $30,600 End. Balance $26,600 Work-in-process inventory Beg. Balance $17,100 5 $30,600 Transferred to Finished Goods $45100 End. Balance $2,600 Manufacturing Overhead Control Beg. Balance 1 $1,300 6 $28000 7 $22,100 8 $32200 9 $5,600 End. Balance $89200 Applied Manufacturing Overhead Beg. Balance 8 $32,200 End. Balance $32,200 Accounts Payable Beg. Balance 1 $23,000 3 $25,600 4 $23,000 End. Balance $25,600 Cash Beg. Balance 4 $23,000 7 $22,100 End. Balance $45,100 Wages Payable Beg. Balance 6 $28,000 End. Balance $28,000 Accumulated Depreciation-Property, Plant and Equipment Beg. Balance 9 $5,600 End. Balance $5,600 Finished Goods Inventory Beg. Balance $65600 Goods Completed $45100 Transferred to Cost of Goods Sold $73600 End. Balance $37100 Cost of Goods Sold Beg. Balance Finished Goods Inventory $73600 End. Balance $73600

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