The following transactions occurred in October at Pawnee Workshops, a custom manufacturer of furniture: 1. Purchased $16,000
Question:
The following transactions occurred in October at Pawnee Workshops, a custom manufacturer of furniture:
1. Purchased $16,000 of materials.
2. Issued $800 of supplies from the materials inventory.
3. Purchased $11,200 of materials.
4. Paid for the materials purchased in transaction (1).
5. Issued $13,600 in direct materials to the production department.
6. Incurred direct labor costs of $20,000, which were credited to Wages Payable.
7. Paid $21,200 cash for utilities, power, equipment maintenance, and other miscellaneous items for the manufacturing plant.
8. Applied overhead on the basis of 125 percent of $20,000 direct labor costs.
9. Recognized depreciation on manufacturing property, plant, and equipment of $10,000. The following balances appeared in the accounts of Pawnee Workshops for October:
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Required
a. Prepare journal entries to record the transactions.
b. Prepare T-accounts to show the flow of costs during the period from Materials Inventory through Cost of GoodsSold.
Step by Step Answer:
a 1 Materials Inventory 16000 Accounts Payable 16000 2 Manufacturing Overhead Control 800 Materials ...View the full answer
Fundamentals of Cost Accounting
ISBN: 978-0077398194
3rd Edition
Authors: William Lanen, Shannon Anderson, Michael Maher
