Quality Brick Company produces bricks in two processing departments-Molding and
ID: 2423062 • Letter: Q
Question
Quality Brick Company produces bricks in two processing departments-Molding and Firing. Information relating to the company's operations in March follows: Raw materials were issued for use in production: Molding Department, $26,700; and Firing Department, $5,300. Direct labor costs were incurred: Molding Department, $16,800; and Firing Department, $4,200. Manufacturing overhead was applied: Molding Department, $25,000; and Firing Department, $39,100. Unfired, molded bricks were transferred from the Molding Department to the Firing Department. According to the company's process costing system, the cost of the unfired, molded bricks was $67,700. Finished bricks were transferred from the Firing Department to the finished goods warehouse. According to the company's process costing system, the cost of the finished bricks was $109,800. Finished bricks were sold to customers. According to the company's process costing system, the cost of the finished bricks sold was $103,200.Explanation / Answer
The journal entries are given below:
Account Titles Debit Credit a) Work in Process – Molding Department $26,700 Work in Process – Firing Department $5,300 Raw Materials (26,700+5,300) $32,000 b) Work in Process – Molding Department $16,800 Work in Process – Firing Department $4,200 Wages Payable (16,800+4,200) $21,000 c) Work in Process – Molding Department $25,000 Work in Process – Firing Department $39,100 Manufacturing Overhead (25,000+39,100) $64,100 d) Work in Process – Firing Department $67,700 Work in Process – Molding Department $67,700 e) Finished Goods $109,800 Work in Process – Firing Department $109,800 f) Cost of Goods Sold $103,200 Finished Goods $103,200