- Forest Components Makes Aircraft Parts The Following Transactions Occurred In July 1 Purchased 119 000 Of Materials 1 (33.89 KiB) Viewed 3 times
- Forest Components Makes Aircraft Parts The Following Transactions Occurred In July 1 Purchased 119 000 Of Materials 2 (33.89 KiB) Viewed 3 times
- Forest Components Makes Aircraft Parts The Following Transactions Occurred In July 1 Purchased 119 000 Of Materials 3 (59.51 KiB) Viewed 3 times
Forest Components makes aircraft parts. The following transactions occurred in July. 1. Purchased $119,000 of materials on account. 2. Issued $117,600 in direct materials to the production department. 3. Issued $8,400 of supplies from the materials inventory. 4. Paid for the materials purchased in transaction (1) using cash. 5. Returned $15,400 of the materials issued to production in (2) to the materials inventory. 6. Direct labor employees earned $217,000, which was paid in cash. 7. Purchased miscellaneous items for the manufacturing plant for $120,400 on account. 8. Recognized depreciation on manufacturing plant of $245,000. 9. Applied manufacturing overhead for the month. Forest uses normal costing. It applies overhead on the basis of direct labor costs using an annual, predetermined rate. At the beginning of the year, management estimated that direct labor costs for the year would be $3,000,000. Estimated overhead for the year was $2,790,000. The following balances appeared in the inventory accounts of Forest Components for July Ending Materials Inventory Work-in-Process Inventory Finished Goods Inventory Cost of Goods Sold: Beginning 7 7 $18,200 $88,200 73,500 49,700 521,500 Required: a. Prepare journal entries to record these transactions. b. Prepare T-accounts to show the flow of costs during the period from Materials Inventory through Cost of Goods Sold.
Prepare T-accounts to show the flow of costs during the period from Materials Inventory through Cost of Goods Sold. Materials Inventory Work-In-Process Inventory Beg, bal. 1. 5. End. bal. Beg bal. End. bal. Beg. bal. End, bal End, bal. 119,000 Beg. bal. Goods completed End. bal. 15,400 8,400 Manufacturing Overhead Control Accounts Payable 0 Accumulated Depreciation Property, Plant, and Equipment Beg, bal. 117,600 2 8,400 3. 0 Cost of Goods Sold 521,500 521,500 Beg. bal. 2 End. bal.. Beg. bal. End. bal. Beg. bal. End, bal. Beg. bal. Goods completed End, bal. 117,600 102,200 15,400 5 Cash Transferred to Finished Goods Applied Manufacturing Overhead Finished Goods Inventory 18,200 521,500 539,700 Transfer to Cost of Goods Sold