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Sierra Company manufactures soccer balls in two sequential processes: Cutting and Stitching. All direct materials enter production at the beginning of the cutting process. The following information is available regarding its May Inventories. Raw materials inventory Work in process inventory-Cutting Work in process inventory-Stitching Finished goods inventory Direct materials. Raw materials purchased on credit Direct materials used-Cutting Direct materials used-Stitching Direct labor Direct labor-Cutting Direct labor-Stitching The following additional Information describes the company's production activities for May Factory Overhead (Actual costs) ect material used Indirect labor used Other overhead costs Factory Overhead Rates Cutting Stitching Sales Problem 20-5A (Algo) Part 1 $ 24,100 96,400 (a) Transferred to work in (b) Transferred to finished goods (c) Cost of goods sold Beginning Inventory $ 91,000 213,500 233,300 54,100 cess-Stitching $ 110,000 26,000 0 Ending Inventory $ 110,200 $ 64,800 58,400 64,000 145,500 113,200 42,250 Required: 1. Compute the amount of (a) production costs transferred from Cutting to Stitching, (b) production costs transferred from Stitching to finished goods, and (c) cost of goods sold. Hint: Compute the total production costs in each department and then subtract the ending Inventory to get the amount transferred out of each department. 150% of direct materials used 120% of direct labor used $ 936,000

Sierra Company manufactures soccer balls in two sequential processes: Cutting and Stitching. All direct materials enter production at the beginning of the cutting process. The following information is available regarding its May Inventories. Raw materials inventory Work in process inventory-Cutting Work in process inventory-Stitching Finished goods inventory Direct materials. Raw materials purchased on credit Direct materials used-Cutting Direct materials used-Stitching Direct labor Direct labor-Cutting Direct labor-Stitching The following additional Information describes the company's production activities for May Factory Overhead (Actual costs) ect material used Indirect labor used Other overhead costs Factory Overhead Rates Cutting Stitching Sales Problem 20-5A (Algo) Part 1 $ 24,100 96,400 (a) Transferred to work in (b) Transferred to finished goods (c) Cost of goods sold Beginning Inventory $ 91,000 213,500 233,300 54,100 cess-Stitching $ 110,000 26,000 0 Ending Inventory $ 110,200 $ 64,800 58,400 64,000 145,500 113,200 42,250 Required: 1. Compute the amount of (a) production costs transferred from Cutting to Stitching, (b) production costs transferred from Stitching to finished goods, and (c) cost of goods sold. Hint: Compute the total production costs in each department and then subtract the ending Inventory to get the amount transferred out of each department. 150% of direct materials used 120% of direct labor used $ 936,000

FINANCIAL ACCOUNTING
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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e following information applies to the questions displayed below. Sierra Company manufactures soccer balls in two sequential processes: Cutting and Stitching. All direct materials enter production at the beginning of the cutting process. The following information is available regarding its May Inventories. Raw materials inventory Work in process inventory-Cutting Work in process inventory-Stitching Finished goods inventory Direct materials Raw materials purchased on credit Direct materials used-Cutting Direct materials used-Stitching Direct labor Direct labor-Cutting Direct labor-Stitching The following additional Information describes the company's production activities for May. Factory Overhead (Actual costs) Indirect materials used Indirect labor used Other overhead costs Factory Overhead Rates Cutting Stitching Sales Problem 20-5A (Algo) Part 1 $ 24,100 96,400 Beginning Inventory $ 91,000 213,500 233,300 54,100 (a) Transferred to work in process-Stitching (b) Transferred to finished goods (c) Cost of goods sold $ 110,000 26,000 0 Ending Inventory $ 110, 200 $ 64,800 58,400 64,000 145,500 113,200 42,250 150% of direct materials used 120% of direct labor used $ 936,000 Required: 1. Compute the amount of (a) production costs transferred from Cutting to Stitching, (b) production costs transferred from Stitching to finished goods, and (c) cost of goods sold. Hint: Compute the total production costs in each department and then subtract the ending Inventory to get the amount transferred out of each department.
Transcribed Image Text:e following information applies to the questions displayed below. Sierra Company manufactures soccer balls in two sequential processes: Cutting and Stitching. All direct materials enter production at the beginning of the cutting process. The following information is available regarding its May Inventories. Raw materials inventory Work in process inventory-Cutting Work in process inventory-Stitching Finished goods inventory Direct materials Raw materials purchased on credit Direct materials used-Cutting Direct materials used-Stitching Direct labor Direct labor-Cutting Direct labor-Stitching The following additional Information describes the company's production activities for May. Factory Overhead (Actual costs) Indirect materials used Indirect labor used Other overhead costs Factory Overhead Rates Cutting Stitching Sales Problem 20-5A (Algo) Part 1 $ 24,100 96,400 Beginning Inventory $ 91,000 213,500 233,300 54,100 (a) Transferred to work in process-Stitching (b) Transferred to finished goods (c) Cost of goods sold $ 110,000 26,000 0 Ending Inventory $ 110, 200 $ 64,800 58,400 64,000 145,500 113,200 42,250 150% of direct materials used 120% of direct labor used $ 936,000 Required: 1. Compute the amount of (a) production costs transferred from Cutting to Stitching, (b) production costs transferred from Stitching to finished goods, and (c) cost of goods sold. Hint: Compute the total production costs in each department and then subtract the ending Inventory to get the amount transferred out of each department.
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