a. Prepare journal entries to record the transactions.b. Prepare T-accounts to show the flow of costs during the period from Materials Inventory through Cost of Goods sold. **Educational Website Content: Flow of Costs Through T-Accounts**The following T-accounts are designed to illustrate the flow of costs during the period from Materials Inventory through to Cost of Goods Sold.### Materials Inventory- **Beg. bal.**: (Beginning balance)- Several lines for entries.- **End. bal.**: (Ending balance)### Work-in-Process Inventory- **Beg. bal.**: (Beginning balance)- Several lines for entries.- Space for "Finished Goods" entry.- **End. bal.**: (Ending balance)### Manufacturing Overhead Control- **Beg. bal.**: (Beginning balance)- Several lines for entries.- **End. bal.**: (Ending balance)### Applied Manufacturing Overhead- **Beg. bal.**: (Beginning balance)- Several lines for entries.- **End. bal.**: (Ending balance)### Accounts Payable- **Beg. bal.**: (Beginning balance)- Several lines for entries.- **End. bal.**: (Ending balance)### Cash- **Beg. bal.**: (Beginning balance)- Several lines for entries.- **End. bal.**: (Ending balance)### Wages Payable- **Beg. bal.**: (Beginning balance)- Several lines for entries.- **End. bal.**: (Ending balance)### Accumulated Depreciation—Property, Plant, and Equipment- **Beg. bal.**: (Beginning balance)- Several lines for entries.- **End. bal.**: (Ending balance)### Finished Goods Inventory- **Beg. bal.**: (Beginning balance)- Lines for entries such as “Goods completed.”- **End. bal.**: (Ending balance)### Cost of Goods Sold- **Beg. bal.**: (Beginning balance)- Line indicating "Transfer to Cost of Goods Sold" from Finished Goods.- **End. bal.**: (Ending balance)**Note:** This setup is typically for instructional purposes, demonstrating the journaling and transfer of financial information across different stages of inventory and cost management. Each entry line is meant to track transactions affecting the T-account balances throughout the process. The following transactions occurred in April at Steve’s Cabinets, a custom cabinet firm.1. Purchased $80,000 of materials on account.2. Issued $4,000 of supplies from the materials inventory.3. Purchased $56,000 of materials on account.4. Paid for the materials purchased in transaction (1) using cash.5. Issued $68,000 in direct materials to the production department.6. Incurred direct labor costs of $100,000, which were credited to Wages Payable.7. Paid $106,000 cash for utilities, power, equipment maintenance, and other miscellaneous items for the manufacturing plant.8. Applied overhead on the basis of 125 percent of $100,000 direct labor costs.9. Recognized depreciation on manufacturing property, plant, and equipment of $50,000.The following balances appeared in the accounts of Steve’s Cabinets for April.| Account | Beginning | Ending ||---------------------------------|-----------|----------|| Materials Inventory | $148,200 | || Work-in-Process Inventory | $33,000 | || Finished Goods Inventory | $166,000 | $143,200 || Cost of Goods Sold | | $263,400 |**Required:**a. Prepare journal entries to record the transactions.b. Prepare T-accounts to show the flow of costs during the period from Materials Inventory through Cost of Goods Sold.

A journal entry is a form of accounting entry that is used to report a business transaction in a…

The following transactions occured in April at Steve's Cabinets, a custom cabinet firm. 1. Purchased $80,000 of materials on account. 2. Issued $4,000 of supplies from the materials inventory. 3. Purchased $56,000 of materials on account. 4. Paid for the materials purchased in transaction (1) using cash. 5, Issued $68,000 In direct materials to the production department. 6, Incurred direct labor costs of $100,000, which were credited to Wages Payable. 7. Paid $106,000 cash for utilities, power, equipment maintenance, and other miscellaneous items for the manufacturing plant. 8. Applied overhead on the basis of 125 percent of $100,000 direct labor costs. 9. Recognized depreciation on manufacturing property, plant, and equipment of $50,000. The following balances appeared in the accounts of Steve's Cabinets for April. Beginning $148,200 33,000 166,000 Ending Materiale Inventory Mork-in-Process Inventory Tiniahed Goods Inventory Cost of Cooda Sold $143,200 263,400 Required: a. Prepare journal entries to record the transactions. b. Prepare T-accounts to show the flow of costs during the period from Materials Inventory through Cost of Goods Sold.

The following transactions occured in April at Steve's Cabinets, a custom cabinet firm. 1. Purchased $80,000 of materials on account. 2. Issued $4,000 of supplies from the materials inventory. 3. Purchased $56,000 of materials on account. 4. Paid for the materials purchased in transaction (1) using cash. 5, Issued $68,000 In direct materials to the production department. 6, Incurred direct labor costs of $100,000, which were credited to Wages Payable. 7. Paid $106,000 cash for utilities, power, equipment maintenance, and other miscellaneous items for the manufacturing plant. 8. Applied overhead on the basis of 125 percent of $100,000 direct labor costs. 9. Recognized depreciation on manufacturing property, plant, and equipment of $50,000. The following balances appeared in the accounts of Steve's Cabinets for April. Beginning $148,200 33,000 166,000 Ending Materiale Inventory Mork-in-Process Inventory Tiniahed Goods Inventory Cost of Cooda Sold $143,200 263,400 Required: a. Prepare journal entries to record the transactions. b. Prepare T-accounts to show the flow of costs during the period from Materials Inventory through Cost of Goods Sold.

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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