The following transactions occurred in June at Fast Wheels, Inc., a custom bicycle manufacturer: 1. Purchased $20,000 of materials. 2. Issued $1,000 of supplies from the materials inventory. 3. Purchased $25,000 of materials. 4. Paid for the materials purchased in transaction (1). 5. Issued $30,000 in direct materials to the production department. 6. Incurred direct labor costs of $25,000, which

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The following transactions occurred in June at Fast Wheels, Inc., a custom bicycle manufacturer:

1. Purchased $20,000 of materials.

2. Issued $1,000 of supplies from the materials inventory.

3. Purchased $25,000 of materials.

4. Paid for the materials purchased in transaction (1).

5. Issued $30,000 in direct materials to the production department.

6. Incurred direct labor costs of $25,000, which were credited to Wages Payable.

7. Paid $21,500 cash for utilities, power, equipment maintenance, and other miscellaneous items for the manufacturing shop.

8. Applied overhead on the basis of 125 percent of direct labor costs.

9. Recognized depreciation on manufacturing property, plant, and equipment of $5,000.

The following balances appeared in the accounts of Fast Wheels for June:


The following transactions occurred in June at Fast Wheels, Inc.,


Required
a. Prepare journal entries to record the transactions.
b. Prepare T-accounts to show the low of costs during the period from Materials Inventory through Cost of GoodsSold.

Related Book For answer-question

Fundamentals of Cost Accounting

4th edition

Authors: William Lanen, Shannon Anderson, Michael Maher

ISBN: 978-0078025525