I have everything but Goods in Process Inventory. How can I get Goods in Process

Question

I have everything but Goods in Process Inventory. How can I get Goods in Process Inventory?
Listor Company made 3,800 bookshelves using 23,200 board feet of wood costing $290,000. The company's direct materials standards for one bookshelf are 8 board feet of wood at $12 per board foot. Listor Company records standard costs in its accounts and its material variances in separate accounts when it assigns materials costs to the Goods in Process Inventory account.

Requirement 1:

Show the journal entry that both charges the direct materials costs to the Goods in Process Inventory account and records the materials variances in their proper accounts.

Explanation / Answer

One beekshlef requires 8 board feet of wood. For making 3,800 bookshelves requires 3,800*8 = 30,400bft Standard cost per board foot is$12 Total standard cost for 30,400bft = 30,400*12 = $364,800 Actual Quantity    = 23,200 bft Actual Cost   = $290,000 Journals: Issue raw materials for production at a cost of $290,000 when the standard cost is $364,800 Work in Process Inventory              $364,800                      Materials Price Variance                       74,800                       Accounts payable                               290,000   (To record material costs)                  Here standard cost debits to Work in process inventory , and credit to accounts payable account. Here credits the price variance, which is favorable. Issue raw materials for production at a cost of $290,000 when the standard cost is $364,800 Work in Process Inventory              $364,800                      Materials Price Variance                       74,800                       Accounts payable                               290,000   (To record material costs)                  Here standard cost debits to Work in process inventory , and credit to accounts payable account. Here credits the price variance, which is favorable.

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