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Problem GRP1 Basic Cost System: Journal Entries: Financial Statements ABC Manufacturing Co. The post-closing trial balance of ABC Manufacturing Co. at September 30 is reproduced as follows. ABC Star Manufacturing Co. Post-Closing Trial Balance September 30, 2011 Cash.. 14,000 17,000 24,000 4.000 8,000 156.000 Accounts Receivable Finished Goods Work in Process. Materials.. Building Accumulated Depreciation-Building. Factory Equipment Accumulated Depreciation-Factory Equipment Office Equipment.. Accumulated Depreciation-Office Equipment Accounts Payable.. Capital Stock Retained Earnings ........ ....... 23,400 108,000 54,000 ....... 12.000 2,000 30.000 172.000 61.600 ...... ............ Total $343,000 $343,000 During the month of October, the following transactions took place: a. Raw materials at a cost of $60,000 and general factory supplies costing $8.000 were purchased on account. (Materials and supplies are recorded in the materials account.) b. Raw materials to be used in production costing $41,000 and miscellaneous factory supplies costing $5,500 were issued. c. Wages and salaries incurred and paid for the month were as follows: factory wages (including $2,500 indirect labor), $34,000, and selling and administrative salaries, $5.000. (Ignore payroll withholdings and deductions.) d. Distributed the payroll in (c). e. Depreciation was recorded for the month at an annual rate of 5% on the building and 20% on the factory equipment and office equipment. The sales and administrative staff uses approximately one-fifth of the

Problem GRP1 Basic Cost System: Journal Entries: Financial Statements ABC Manufacturing Co. The post-closing trial balance of ABC Manufacturing Co. at September 30 is reproduced as follows. ABC Star Manufacturing Co. Post-Closing Trial Balance September 30, 2011 Cash.. 14,000 17,000 24,000 4.000 8,000 156.000 Accounts Receivable Finished Goods Work in Process. Materials.. Building Accumulated Depreciation-Building. Factory Equipment Accumulated Depreciation-Factory Equipment Office Equipment.. Accumulated Depreciation-Office Equipment Accounts Payable.. Capital Stock Retained Earnings ........ ....... 23,400 108,000 54,000 ....... 12.000 2,000 30.000 172.000 61.600 ...... ............ Total $343,000 $343,000 During the month of October, the following transactions took place: a. Raw materials at a cost of $60,000 and general factory supplies costing $8.000 were purchased on account. (Materials and supplies are recorded in the materials account.) b. Raw materials to be used in production costing $41,000 and miscellaneous factory supplies costing $5,500 were issued. c. Wages and salaries incurred and paid for the month were as follows: factory wages (including $2,500 indirect labor), $34,000, and selling and administrative salaries, $5.000. (Ignore payroll withholdings and deductions.) d. Distributed the payroll in (c). e. Depreciation was recorded for the month at an annual rate of 5% on the building and 20% on the factory equipment and office equipment. The sales and administrative staff uses approximately one-fifth of the

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Problem GRP1 Basic Cost System: Journal Entries: Financial Statements ABC Manufacturing Co. The post-closing trial balance of ABC Manufacturing Co. at September 30 is reproduced as follows. ABC Star Manufacturing Co. Post-Closing Trial Balance September 30, 2011 Cash. Accounts Receivable Finished Goods. Work in Process Materials. Building Accumulated DepreciationBuilding Factory Equipment Accumulated Depreciation-Factory Equipment Office Equipment. Accumulated Depreciation Office Equipment Accounts Payable Capital Stock Retained Earnings 14,000 17,000 24,000 4,000 8,000 156.000 23,400 108,000 54,000 12,000 2.000 30,000 172.000 61.600 Total $343,000 $343,000 During the month of October, the following transactions took place: a. Raw materials at a cost of $60,000 and general factory supplies costing $8.000 were purchased on account. (Materials and supplies are recorded in the materials account.) b. Raw materials to be used in production costing $41,000 and miscellaneous factory supplies costing $5,500 were issued. c. Wages and salaries incurred and paid for the month were as follows: factory wages (including $2,500 indirect labor), $34,000, and selling and administrative salaries, $5,000. (Ignore payroll withholdings and deductions.) d. Distributed the payroll in (c). e. Depreciation was recorded for the month at an annual rate of 5% on the building and 20% on the factory equipment and office equipment. The sales and administrative staff uses approximately one-fifth of the
Transcribed Image Text:Problem GRP1 Basic Cost System: Journal Entries: Financial Statements ABC Manufacturing Co. The post-closing trial balance of ABC Manufacturing Co. at September 30 is reproduced as follows. ABC Star Manufacturing Co. Post-Closing Trial Balance September 30, 2011 Cash. Accounts Receivable Finished Goods. Work in Process Materials. Building Accumulated DepreciationBuilding Factory Equipment Accumulated Depreciation-Factory Equipment Office Equipment. Accumulated Depreciation Office Equipment Accounts Payable Capital Stock Retained Earnings 14,000 17,000 24,000 4,000 8,000 156.000 23,400 108,000 54,000 12,000 2.000 30,000 172.000 61.600 Total $343,000 $343,000 During the month of October, the following transactions took place: a. Raw materials at a cost of $60,000 and general factory supplies costing $8.000 were purchased on account. (Materials and supplies are recorded in the materials account.) b. Raw materials to be used in production costing $41,000 and miscellaneous factory supplies costing $5,500 were issued. c. Wages and salaries incurred and paid for the month were as follows: factory wages (including $2,500 indirect labor), $34,000, and selling and administrative salaries, $5,000. (Ignore payroll withholdings and deductions.) d. Distributed the payroll in (c). e. Depreciation was recorded for the month at an annual rate of 5% on the building and 20% on the factory equipment and office equipment. The sales and administrative staff uses approximately one-fifth of the
building for its offices. f. During the month, various other expenses totaling $5,200 were incurred on account. The company has determined that one-fourth of this amount is allocable to the office function. g. Total factory overhead costs were transferred to Work in Process. h. During the month, goods with a total cost of $79,000 were completed and transferred to the finished goods storeroom. i. Sales for the month totaled $128,000 for goods costing $87,000 to manufacture. (Assume that all sales were made on account.) j. Accounts receivable in the amount of $105,000 were collected. k. Accounts payable totaling $55,000 were paid. Required: 1. Prepare journal entries to record the transactions. 2. Set up T-accounts for all accounts listed in the September 30, 2011, Post-Closing Trial Balance and for Cost of Goods Sold, Factory Overhead, Selling and Administrative Expenses, Sales, and Wages Payable. Post the beginning trial balance and the journal entries prepared in Part 1 to the accounts and calculate the balances in the accounts on October 31. 3. Prepare a statement of cost of goods manufactured, an income stateme and a balance sheet.
Transcribed Image Text:building for its offices. f. During the month, various other expenses totaling $5,200 were incurred on account. The company has determined that one-fourth of this amount is allocable to the office function. g. Total factory overhead costs were transferred to Work in Process. h. During the month, goods with a total cost of $79,000 were completed and transferred to the finished goods storeroom. i. Sales for the month totaled $128,000 for goods costing $87,000 to manufacture. (Assume that all sales were made on account.) j. Accounts receivable in the amount of $105,000 were collected. k. Accounts payable totaling $55,000 were paid. Required: 1. Prepare journal entries to record the transactions. 2. Set up T-accounts for all accounts listed in the September 30, 2011, Post-Closing Trial Balance and for Cost of Goods Sold, Factory Overhead, Selling and Administrative Expenses, Sales, and Wages Payable. Post the beginning trial balance and the journal entries prepared in Part 1 to the accounts and calculate the balances in the accounts on October 31. 3. Prepare a statement of cost of goods manufactured, an income stateme and a balance sheet.
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