Manufacturing Costs-Process Cost Systoms10 points Milton Company makos t-shirts.

Question

Manufacturing Costs-Process Cost Systoms10 points Milton Company makos t-shirts. The shirts move through two dopartments during the production procoss First, fabric is cut in the Cutting Departmont. Tho tabric plocos aro thon transforred to tho Sowing Dopartmont whore the shirts are assombled. The shirts aro thon sold to rotail stoms. The following transactions apply to the company's operations during its first yoar. Assume that all transactions aro for cash unloss othorwiso stated 1. Purchased $30,000 of diroct raw matorials. 2. Diroct materials issued to the cutting and sowing dopartments aro $10,000 and $2,000 rospectvoly 3. Paid labor cost of $24,400. Direct labor usago for the cutting and assembly departments was $14,000 and 4. Paid actual other overhead costs, $4,000 5. Appliod ovorhead to production in both dopartments using the prodetormined overhoad rato of $0.30 perc 6. Transferred $21,000 of inventory from the Cutting Dopartment to the Sowing Dopartmont. 7. Transforrod $30,400 of inventory from the Sewing Department to Finished Goods. 8. Sold invontory costing $16,000 for $25,000 cash. a Open T-accounts and post transactions to the accounts. Cash Manufacturing Overhead Work In Process- Cutting Bal Bal Bal Raw Materials Finished Goods Work In Process- Sewing Bal Bal Bal Cost of Goods Sold Sales Revenue Bal Bal

Explanation / Answer

Cash Manufacturing Overhead Work in Process-Cutting 8 25000 30000 1 3 2400 4200 5 3 14000 10000 2 24400 3 4 4000 2400 5 5 4200 21000 6 4000 4 Bal. Bal. Bal. Raw Materials Finished Goods Work in Process-Sewing 1 30000 10000 2 7 30400 16000 8 3 8000 2000 2 2000 2 5 2400 30400 7 6 21000 Bal. Bal. Bal. Cost of Goods Sold Sales Revenue 8 16000 25000 8 Bal. Bal.

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