Chapter 20, Problem 20.1APR

Entries for process cost system

FloorMate Carpet Company manufactures carpets. Fiber is placed in process in the Spinning Department, where it is spun into yarn. The output of the Spinning Department is transferred to the Tufting Department, where carpet backing is added at the beginning of the process and the process is completed. On October 1, FloorMate Carpet Company had the following inventories:

Finished Goods	$5,600
Work in Process—Spinning Department	1,500
Work in Process—Tufting Department	2,300
Materials	4,800

Departmental accounts are maintained for factory overhead, and both have zero balances on October 1.

Manufacturing operations for October are summarized as follows:

a. Materials purchased on account	$84,900
b. Materials requisitioned for use:
Fiber—Spinning Department	$43,600
Carpet backing—Tufting Department	34,100
Indirect materials—Spinning Department	3,200
Indirect materials—Tufting Department	2,900
c. Labor used:
Direct labor—Spinning Department	$26,300
Direct labor—Tufting Department	17,900
Indirect labor—Spinning Department	12,100
Indirect labor—Tufting Department	11,700
d. Depreciation charged on fixed assets:
Spinning Department	$5,300
Tufting Department	3,400
e. Expired prepaid factory insurance:
Spinning Department	$1,200
Tufting Department	1,000
f. Applied factory overhead:
Spinning Department	$22,000
Tufting Department	18,700
g. Production costs transferred from Spinning Department to Tufting Department	$88,000
h. Production costs transferred from Tufting Department to Finished Goods	$159,000
i. Cost of goods sold during the period	$160,500

Instructions

1. Journalize the entries to record the operations, identifying each entry by letter.

2. Compute the October 31 balances of the inventory accounts.

3. Compute the October 31 balances of the factory overhead accounts.