Prepare summary journal entries to record the following transactions for a company in its first month of operations.Raw materials purchased on account, $90,000.Direct materials used in production, $36,500. Indirect materials used in production, $19,200.Paid cash for factory payroll, $50,000. Of this total, $38,000 is for direct labor and $12,000 is for indirect labor.Paid cash for other actual overhead costs, $11,475.Applied overhead at the rate of 125% of direct labor cost.Transferred cost of jobs completed to finished goods, $56,800.Sold jobs on account for $82,000 g(2). The jobs had a cost of $56,800 g(1).

Journal Entry: A journal entry, in accounting, is the logging of a transaction in an accounting…

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FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Prepare summary journal entries to record the following transactions for a company in its first month of operations.

Raw materials purchased on account, $90,000.
Direct materials used in production, $36,500. Indirect materials used in production, $19,200.
Paid cash for factory payroll, $50,000. Of this total, $38,000 is for direct labor and $12,000 is for indirect labor.
Paid cash for other actual overhead costs, $11,475.
Applied overhead at the rate of 125% of direct labor cost.
Transferred cost of jobs completed to finished goods, $56,800.
Sold jobs on account for $82,000 g(2). The jobs had a cost of $56,800 g(1).

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