Forest Components makes aircraft parts. The following transactions occurred in July. 1. Purchased $16,830 of materials on account. 2. Issued $16,890 in direct materials to the production department. 3. Issued $1,260 of supplies from the materials inventory. 4. Paid for the materials purchased in transaction (1) using cash. 5. Returned $2,040 of the materials issued to production in (2) to the materials inventory. 6. Direct labor employees earned $31,100, which was paid in cash. 7. Purchased miscellaneous items for the manufacturing plant for $17,240 on account. 8. Recognized depreciation on manufacturing plant of $35,500. 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 $434,500. Estimated overhead for the year was $399,740. The following balances appeared in the inventory accounts of Forest Components for July. Beginning Ending ? $12,530 10,600 Materials Inventory Work-in-Process Inventory Finished Goods Inventory Cost of Goods Sold ? $2,780 ? 7,070 73,900
Forest Components makes aircraft parts. The following transactions occurred in July. 1. Purchased $16,830 of materials on account. 2. Issued $16,890 in direct materials to the production department. 3. Issued $1,260 of supplies from the materials inventory. 4. Paid for the materials purchased in transaction (1) using cash. 5. Returned $2,040 of the materials issued to production in (2) to the materials inventory. 6. Direct labor employees earned $31,100, which was paid in cash. 7. Purchased miscellaneous items for the manufacturing plant for $17,240 on account. 8. Recognized depreciation on manufacturing plant of $35,500. 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 $434,500. Estimated overhead for the year was $399,740. The following balances appeared in the inventory accounts of Forest Components for July. Beginning Ending ? $12,530 10,600 Materials Inventory Work-in-Process Inventory Finished Goods Inventory Cost of Goods Sold ? $2,780 ? 7,070 73,900
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Please help with this question that is attached
Required:
a. Prepare
b. Prepare T-accounts to show the flow of costs during the period from Materials Inventory through Cost of Goods Sold.
Transcribed Image Text:Forest Components makes aircraft parts. The following transactions occurred in July.
1. Purchased $16,830 of materials on account.
2. Issued $16,890 in direct materials to the production department.
3. Issued $1,260 of supplies from the materials inventory.
4. Paid for the materials purchased in transaction (1) using cash.
5. Returned $2,040 of the materials issued to production in (2) to the materials inventory.
6. Direct labor employees earned $31,100, which was paid in cash.
7. Purchased miscellaneous items for the manufacturing plant for $17,240 on account.
8. Recognized depreciation on manufacturing plant of $35,500.
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 $434,500. Estimated overhead for the year
was $399,740.
The following balances appeared in the inventory accounts of Forest Components for July.
Materials Inventory
Work-in-Process Inventory
Finished Goods Inventory
Cost of Goods Sold
Beginning Ending
$12,530
?
$2,780
?
10,600
7,070
73,900
Transcribed Image Text: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.
Complete this question by entering your answers in the tabs below.
Required A Required B
Prepare T-accounts to show the flow of costs during the period from Materials Inventory through Cost of Goods Sold.
Work-In-Process Inventory
Materials Inventory
Beg. bal.
End. bal.
Beg. bal.
0
Manufacturing Overhead Control
Beg. bal.
End. bal.
Beg. bal.
Applied Manufacturing Overhead
Transferred to
Finished Goods
Expert Solution
Step 1
Journal entries are the transactions which are recorded in the books to maintain a proper record of the transactions of the business. These are, then, posted to the ledger accounts.
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