Ask Question
7 September, 19:56

Raw materials purchased on account, $102,000. Direct materials used in production, $42,500. Indirect materials used in production, $15,000. Paid cash for factory payroll, $55,000. Of this total, $37,000 is for direct labor and $18,000 is for indirect labor. Paid cash for other actual overhead costs, $8,375. Applied overhead at the rate of 125% of direct labor cost. Transferred cost of jobs completed to finished goods, $72,600. Sold jobs on account for $104,000. The jobs had a cost of $72,600.

+4
Answers (1)
  1. 7 September, 21:41
    0
    Journal Entries are given below in explanation.

    Explanation:

    Account Dr Cr

    1. Raw materials 102000

    Account payable-Liability 102000

    The Materials are purchased in credit.

    2. Work In Process 42500

    Direct materials / Raw materials 42500

    Entry for Materials used in Production.

    3. Factory Overhead 15000

    Raw materials 15000

    Entry for indirect materials used in production

    4. Factory payroll - Salaries 55000

    Cash / Bank 55000

    Salaries to employees are paid through cash.

    5. Direct Labor / Work in Process 37000

    Factory Overhead / Indirect labor 18000

    Factory Payroll 55000

    6. Overhead 8375

    Cash / bank 8375

    7. Work in process 46250

    Applied Overhead 46250

    Applied overhead is charged as 125 % of direct labor cost.

    8. Finished Goods 72600

    Work In Process 72600

    Transfer of inventory from Work in process to Finished Goods

    9. Accounts Receivable 104000

    Sales Revenue 104000

    Cost of goods sold 72600

    Finished Goods 72600

    Entry for selling finished job on account.
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “Raw materials purchased on account, $102,000. Direct materials used in production, $42,500. Indirect materials used in production, $15,000. ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers