Question

Learning Stars produces stars for elementary teachers to reward their students. Learning Stars’ trial balance on June 1 follows:
June 1 balances in the subsidiary ledgers were as follows:
• Raw Materials Inventory subsidiary ledger: Paper, $4,100; indirect materials, $2,000
• Work-in-Process Inventory subsidiary ledger: Job 120, $41,100; Job 121, $0
• Finished Goods Inventory subsidiary ledger: Large Stars, $9,400; Small Stars, $11,700 June transactions are summarized as follows:
a. Collections on account, $150,000.
b. Selling and administrative expenses incurred and paid, $33,000.
c. Payments on account, $40,000.
d. Materials purchases on account: Paper, $20,000; indirect materials, $5,000.
e. Materials requisitioned and used in production:
Job 120: Paper.. $550
Job 121: Paper.. $7,750
Indirect materials.. $1800
f. Wages incurred during June, $37,000. Labor time records for the month: Job 120, $3,750; Job 121, $18,500; indirect labor, $14,750.
g. Wages paid in June include the balance in Wages Payable at May 31 plus $35,000 of wages incurred during June.
h. Depreciation on plant and equipment, $3,000.
i. Manufacturing overhead allocated at the predetermined overhead allocation rate of 50% of direct labor cost.
j. Jobs completed during the month: Job 120 with 300,000 Large Stars at a total cost of $47,275.
k. Sales on account: all of Job 120 for $105,000.
l. Adjusted for overallocated or underallocated manufacturing overhead.
Requirements
1. Journalize the transactions for the company.
2. Open T-accounts for the general ledger, the Raw Materials Inventory subsidiary ledger, the Work-in-Process Inventory subsidiary ledger, and the Finished Goods Inventory subsidiary ledger. Insert each account balance as given, and use the reference Bal. Post the journal entries to the T-accounts using the transaction letters as a reference.
3. Prepare a trial balance at June 30, 2016.
4. Use the Work-in-Process Inventory T-account to prepare a schedule of cost of goods manufactured for the month of June.
5. Prepare an income statement for the month of June.


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  • CreatedJune 15, 2015
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