Answer:
Answer for the question:
The following information is available for Lock-Tite Company, which produces special-order security products and uses a job order costing system. April 30 May 31 $ $32,000 9,300 66,000 37,000 19,200 33, 100 Inventories Raw materials Work in process Finished goods Activities and information for May Raw materials purchases (paid with cash) Factory payroll (paid with cash) Factory overhead Indirect materials Indirect labor Other overhead costs Sales (received in cash) Predetermined overhead rate based on direct labor cost 187,000 250,000 11,000 57,500 94,500 1,000,000 55% 1. Incurred other overhead costs (record credit to Other Accounts). 2. Applied overhead to work in process. Prepare journal entries for the above transactions for the month of May
is given in the attachment.
Explanation:
Answer:
Factory overhead 163,000
Raw materials inventory 11,000
Cash 57,500
Accounts Payable 94,500
--to record actual overehad--
WIP inventory 137,500 debit
factory overhead 137,500 credit
---to record applied overhead--
Other transactions journal entries:
Raw materials 187,000 debit
cash 187,000 credit
--to record purchase of materials--
WIP invenotry 250,000 debit
cash 250,000 credit
--to record direct lbor for the month--
Cash 1,000,000 debit
Sales Revenues 1,000,000 credit
--to record sales--
Explanation:
May Raw materials purchases (paid with cash) 187,000
Factory payroll (paid with cash) 250,000
Factory overhead Indirect materials 11,000
Indirect labor 57,500
Other overhead costs 94,500
Sales (received in cash) 1,000,000
Predetermined overhead rate based on direct labor cost 55%
The actual overhead will be the sum of indirect materials and indirect labor and the other ovehread cost:
11,000 + 57,500 + 94,500 = 163,000
We will debit the actual overhead
credit the inventory and cash account for the labor as it was paid
and credit account payable for the other cost as we aren't given information they were paid.
55% x 250,000 factory labor cost = 137,500
