Chapter 3, Problem 11F15

Bunnell Corporation is a manufacturer that uses job-order costing. On January 1, the company's inventory balances were as follows:

Raw materials..................................$40,000

Work in process................................$18,000

Finished goods...................................$35,000

The company applies overhead cost to jobs on the basis of direct labor-hours. For the current year, the company’s predetermined overhead rate of $16.25 per direct labor-hour was based on a cost formula that estimated $650,000 of total manufacturing overhead for an estimated activity⁷ level of 40,000 direct labor-hours. The following transactions were recorded for the year:

1. Raw materials were purchased on account, $510,000.
2. Raw materials used in production, S480,000. All of of the raw materials were used as direct materials.
3. The following costs were accrued for employee services: direct labor, $600,000: indirect labor, $150,000: selling and administrative salaries, $240,000.
4. Incurred various selling and administrative expenses (e.g., advertising, sales travel costs, and finished goods warehousing), $367,000.
5. Incurred various manufacturing overhead costs (e.g.. depreciation, insurance, and utilities). $500,000.
6. Manufacturing overhead cost was applied to production. The company actually worked 41,000 direct labor-hours on all jobs during the year.
7. Jobs costing $680,000 to manufacture according to their job cost sheets were completed during the year.
8. Jobs were sold on account to customers during the year for a total of $2,800,000. The jobs cost $690,000 to manufacture according to their job cost sheets.

Required

11. What is the journal entry to record the cost of goods sold referred to in item h above?