Shamrock Industries uses process costing. All of the company\'s manufacturing ac

Question

Shamrock Industries uses process costing. All of the company's manufacturing activities take place in a single processing department. The following information was available for the month of June. Direct materials $ 88,000 Direct labor 26,000 Manufacturing overhead applied 42,000 Total costs to account for in June $ 156,000 The amounts of work in process at the beginning and end of the month were immaterial and assigned no dollar value. During June, 13,250 units were completed, of which 10,000 were sold on account at $25 per unit. a. Prepare a journal entry to summarize the total manufacturing costs applied to production in June. b. Prepare the journal entry to transfer completed units from work in process to the finished goods warehouse in June. c. Prepare the journal entries to record the sale of 10,000 units manufactured during the period and the related cost of goods sold.

Explanation / Answer

Accounting titles & Explanations Debit Credit a. Work in process inventory 156,000 Raw materials inventory 88,000 factory payroll 26,000 mnaufacturing overhead 42,000 b. Finished goods inventory 156,000 Work in process inventory 156,000 c. Account receivable 250000 sales (10,000*25) 250,000 Cost of goods sold 117736 finished goods inventory ( 117,736 (156000/13,250)*10,000

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