Chris P. Critters Manufacturing produces custom barbeque grills. Prepare t-accou

Question

Chris P. Critters Manufacturing produces custom barbeque grills. Prepare t-accounts for Cash, Raw Materials Inventory, Work in Process Inventory, Finished Goods Inventory, Cost of Goods Sold, Manufacturing Overhead, Sales, Selling and Administrative Expenses and Owner's Equity. Record the effects of the events in the t-accounts. Show the event letter next to each entry (to help you follow the events). Prepare an income statement and balance sheet for Chris’s company. You must complete all parts to receive credit for the problem.

a. Chris began the year with $3,450 worth of raw materials, $8,400 worth of work in process, $9,500 worth of finished goods, $18,320 cash and $39,670 in Owner's Equity.

b. Chris purchases steel for $3,500 cash, and welding supplies for $600 cash (included were both direct materials and indirect materials)

c. Chris issued $2,000 of steel from the storeroom to be used in producing grills.

d. Chris issued $140 of welding supply (indirect) from the storeroom to be used in producing grills.

e. Chris paid their welders $1,800 cash for work performed in the current period.

f. Chris paid their janitor $200 cash for work performed in the current period.

g. Chris paid cash for rent on welding equipment related to manufacturing grills in the sum of $400.

h. Chris paid cash for advertising expenses of $700.

i. Chris estimated that $800 worth of overhead cost should be applied to the grills in work-in-process.

j. Chris completed grills that had cost $9,400 to produce. These grills were not sold immediately.

k. Chris sold $16,000 worth of grills for $21,400 Cash.

Explanation / Answer

Cash:

Raw Materials Inventory:

Work in Process Inventory

Finished Goods Inventory

Cost of Goods Sold Expense

Manufacturing Overhead

Sales:

Selling and Administrative Expense

Owners' Equity:

Critters Manufacturing

Income Statement:

Critters Manufacturing

Balance Sheet:

Beginning Balance 18,320 b. 4,100 k. 21,400 e. 1,800 f. 200 g. 400 h. 700 Ending Balance 32,520

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