Corporation had the following transactions during its first month of operations
ID: 2400826 • Letter: C
Question
Corporation had the following transactions during its first month of operations Raw Materials of $30,000 were requisitioned to the factory. An analysis of the Factory labor costs incurred were $150,000 of which $120,000 pertained to factory wages payable and s30,000 pertained to employer payroll taxes payable Time tickets indicated that $126.000 was direct labor and $24,000 was indirect labür costs incurred on acobunit were $168,000. overhead was applied the rate of 150% of drect labor wst. goods costing $100,000 to manufacture were sold on account for s:30.000.Explanation / Answer
7**)Cost of units completed = 25000+126000+189000=340000
Finished goods inventory = 340000-115000= 225000
Date Account title Debit credit 1 Raw material inventory 85000 Accounts payable 85000 2 Work in process 25000 Manufacturing overhead 5000 Raw material inventory 30000 3 Factory labor wage expense 150000 Factory wages payable 120000 payroll tax payable 30000 4 work in process 126000 manufacturing overhead 24000 Factory labor 150000 5 manufacturing overhead 168000 Accounts payable 168000 6 work in process 189000 manufacturing overhead [126000*150%] 189000 7 finished goods inventory 225000 work in process 225000 [being units completed transfered**] 8 Accounts receivable 130000 sales revenue 130000 cost of goods sold 100000 finished goods inventory 100000