The following accounts are maintained by the XYZ Manufacturing Company in its ge
ID: 2567811 • Letter: T
Question
The following accounts are maintained by the XYZ Manufacturing Company in its general ledger: Materials, Work in Process, Factory Overhead, and Accounts Payable. The materials account had a debit balance of $40,000 on November 1. A summary of material transactions for November shows:
(1)
Materials purchased on account, $62,000
(2)
Direct materials issued, $58,500
(3)
Direct materials returned to storeroom, $1,200
(4)
Indirect materials issued, $3,600
(5)
Indirect materials returned to storeroom, $550
(6)
Materials on hand were $200 less than the stores ledger balance
Prepare journal entries to record the materials transactions.
(1)
Materials purchased on account, $62,000
(2)
Direct materials issued, $58,500
(3)
Direct materials returned to storeroom, $1,200
(4)
Indirect materials issued, $3,600
(5)
Indirect materials returned to storeroom, $550
(6)
Materials on hand were $200 less than the stores ledger balance
Explanation / Answer
Journal
No. Account Name Debit Credit 1. Raw material inventory $62000 Accounts payable $62000 2. Work in process inventory 58500 Raw material inventory 58500 3. Raw material inventory 1200 Work in process inventory 1200 4. Factory overhead 3600 Raw material inventory 3600 5. Raw material inventory 550 Factory overhead 550 6. Inventory loss expense 200 Raw material inventory 200