Elmira Tool and Die makes machine tools to order. The following transactions occurred in October: 1. Issued $3,200 of supplies from the materials inventory. 2. Purchased $44,000 of materials. 3. Issued $39,600 in direct materials to the production department. 4. Paid $44,200 for miscellaneous items for the manufacturing plant. Accounts Payable was credited. 5. Returned $6,200 of the materials issued to production in (3) to the materials inventory. 6. Direct labor employees earned $74,000, 50% of which was paid in cash and the remainder credited to Wages Payable. 7. Purchased $14,000 of materials on account. 8. Recognized depreciation on manufacturing plant of $88,000. 9. Paid for the materials purchased in transaction (2). 0. Applied manufacturing overhead for the month. Elmira uses normal costing. It applies overhead on the basis of materials costs using an annual, predetermined rate. At the beginning of the year, management estimated that materials costs for the year would be $508,000. Estimated overhead for the year was $2,082,800. The following balances appeared in the inventory accounts of Elmira Tool and Die for October: Ending $ 29,800 26,000 99, 100 179,300 Materials Inventory Work-in-Process Inventory Finished Goods Inventory Cost of Goods Sold Beginning ? ? $ 8,000 ? 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.
Elmira Tool and Die makes machine tools to order. The following transactions occurred in October: 1. Issued $3,200 of supplies from the materials inventory. 2. Purchased $44,000 of materials. 3. Issued $39,600 in direct materials to the production department. 4. Paid $44,200 for miscellaneous items for the manufacturing plant. Accounts Payable was credited. 5. Returned $6,200 of the materials issued to production in (3) to the materials inventory. 6. Direct labor employees earned $74,000, 50% of which was paid in cash and the remainder credited to Wages Payable. 7. Purchased $14,000 of materials on account. 8. Recognized depreciation on manufacturing plant of $88,000. 9. Paid for the materials purchased in transaction (2). 0. Applied manufacturing overhead for the month. Elmira uses normal costing. It applies overhead on the basis of materials costs using an annual, predetermined rate. At the beginning of the year, management estimated that materials costs for the year would be $508,000. Estimated overhead for the year was $2,082,800. The following balances appeared in the inventory accounts of Elmira Tool and Die for October: Ending $ 29,800 26,000 99, 100 179,300 Materials Inventory Work-in-Process Inventory Finished Goods Inventory Cost of Goods Sold Beginning ? ? $ 8,000 ? 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.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Exercise 7-26 (Algo) Assigning Costs to Jobs (LO 7-1)
Elmira Tool and Die makes machine tools to order. The following transactions occurred in October:
1. Issued $3,200 of supplies from the materials inventory.
2. Purchased $44,000 of materials.
3. Issued $39,600 in direct materials to the production department.
4. Paid $44,200 for miscellaneous items for the manufacturing plant. Accounts Payable was credited.
5. Returned $6,200 of the materials issued to production in (3) to the materials inventory.
6. Direct labor employees earned $74,000, 50% of which was paid in cash and the remainder credited to Wages Payable.
7. Purchased $14,000 of materials on account.
8. Recognized depreciation on manufacturing plant of $88,000.
9. Paid for the materials purchased in transaction (2).
O. Applied manufacturing overhead for the month.
Elmira uses normal costing. It applies overhead on the basis of materials costs using an annual, predetermined rate. At the
beginning of the year, management estimated that materials costs for the year would be $508,000. Estimated overhead for the
year was $2,082,800.
The following balances appeared in the inventory accounts of Elmira Tool and Die for October:
Beginning
Ending
$ 29,800
26,000
99, 100
179,300
Materials Inventory
Work-in-Process Inventory
Finished Goods Inventory
Cost of Goods Sold
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.
?
$ 8,000
?
Complete this question by entering your answers in the tabs below.
Required A
Required B
Prepare journal entries to record these transactions.
Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.
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