In April 2013, NoCal Trailers Co. had the following cost data: Raw materials cos
ID: 2499367 • Letter: I
Question
In April 2013, NoCal Trailers Co. had the following cost data:
Raw materials costing $82,000 were purchased.
Raw materials costing $80,000 were used: direct materials, $75,000; indirect materials $5,000.
Factory wages of $52,000 were incurred: direct labor $50,000; indirect labor $2,000. Social security tax deductions were $3,224, Medicare tax deductions were $754, federal income tax deductions were $7,800.
Other overhead costs of $28,000 were incurred. (Credit Accounts Payable.)
Estimated manufacturing overhead costs were applied to jobs in production at the rate of 80 percent of direct labor costs.
Finished goods costing $150,000 were transferred from production to the warehouse.
The cost of goods sold was $120,000.
Sales on account for the month were $250,000.
Prepare general journal entries to record each item of cost data given
In April 2013, NoCal Trailers Co. had the following cost data:
Explanation / Answer
Date/No. Title Debit credit a Raw material Inventory 82000 Accounts payable 82000 [being raw material purchased] b Work in process 75000 Manufacturing overhead 5000 Raw material Inventory 80000 [being inventory used ] c a Work in process 50000 Manufacturing overhead 2000 social security tax payable 3224 medicare tax payable 754 Federal income tax payable 7800 Factory wages payable 40222 [being factory wages recorded] d Manufacturing overhead 28000 Accounts payable 28000 [being other overhead recorded] e work in process 40000 Manufacturing overhead 40000 [Being overhead applied (50000*.80] f Finished goods inventory 150,000 Work in process Inventory 150,000 [being work in process completed and transferd out g Cost of goods sold 120,000 Finished goods inventory 120,00 [being Inventory sold] h Accounts receivable 250,000 sales 250,000