Prepare the necessary journal entries from the following information for Caudill
ID: 2381510 • Letter: P
Question
Prepare the necessary journal entries from the following information for Caudill Company.
a. Purchased materials on account, $56,700.
b. Requisitioned materials for production as follows: direct materials - 80 percent of purchases, indirect materials - 15 percent of purchases
c. Direct labor for production is $33,100, indirect labor is $12,500.
d. Overhead incurred (not including materials or overhead): $52,900.
e. Overhead is applied to production based on direct labor cost at the rate of 220 percent.
f. Goods costing $97,600 were completed during the period.
g. Goods costing $51,320 were sold on account for $77,600.
h. Close the overhead control account to Cost of Goods Sold.
Explanation / Answer
a) Raw Materials Inv 56700
Account Payable 56700
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b) WIP Inv 45360
Raw Mater Inv-direct 45360
WIP Inv 8505
Raw Mater Inv -indirect 8505
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c) WIP INV 33,100
Wages Payab 33,100
WIP INV 12500
Wages Patable 12500
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d) MOH 66,900
Cash 66900
e) Wip Inv(33100*1.1) 36410
MOH 36410
WIP INV 30,000
MOH 30,000
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g) Finished Goods Inv 97600
WIP INV 97600
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h) Account Receiv 77600
Sales Revenue 77600
Cost of Goods Sold 51320
Finished Goods Inv 51320
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i) MOH 490
Cost of Goods Sold 490
To assign(dispose) overapplied overhead toCGS(66900-36410-30000)=490
Redused CGS
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