Required information [The following information applies to the questions display

Question

Required information [The following information applies to the questions displayed below.j The following information is available for Lock-Tite Company, which produces special-order security products and uses a job order costing system April 30 May 31 Inventories Raw materials Work in process Finished goods $36,000 56,000 20,700 33,200 9,400 67,000 Activities and information for May Raw materials purchases (paid with cash) Factory payrol1 (paid with cash) Factory overhead 197,000 150,000 Indirect materials Indirect labor Other overhead costs 12,000 34,500 109,500 1,700,000 Sales (received in cash) Predetermined overhead rate based on direct labor cost 55% 1. Raw materials purchases for cash 2. Direct materials usage 3. Indirect materials usage Prepare journal entries for the above transactions for the month of May.

Explanation / Answer

Date Journal Debit Credit Raw Materials 197000         To Cash 197000 Work In Process 165000         To Raw Materials 165000 Working Note Raw Material Issued Opening Stock 36000 Add: Purchase 197000 Less: Indirect Material 12000 Less: Closing Stock 56000 Issued to WIP 165000 Factory Overhead 12000         To Raw Materials 12000

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