Lubricants, Inc, produces a special kind of grease that is widely used by race c

Question

Lubricants, Inc, produces a special kind of grease that is widely used by race car drivers. The grease is produced in two processing depertments-Refining and Blending. Raw materials are introduced at various points in the Refining Department The following incomplete Work in Process account is available for the Refining Department for March Work in Process-Refini tment 32,100 Completed and transferred to Blending March 1 balance Materials Direct labor Overhead 146,688 7e,208 474,808 The March 1 work in process inventory in the Refining Department consists of the following elements: materials, $9,000, direct labor, $3,000; and overhead, $20,100 Costs incurred during March in the Blending Department were: materials used, $46,000; direct labor, $16,700; and overheed cost applied to production, $111,000. Required: 1. Prepare journal entries to record the costs incurred in both the Refining Department and Blending Department during March. Key your entries to the items (a) through (g) below a. Raw materials used in production. b. Direct labor costs incurred C. Manufacturing overhead costs incurred for the entire factory, $706,000. (Credit Accounts Payable) d. Manufacturing overhead was applied to production using a predetermined overhead rate. e. Units that were complete with respect to processing in the Refining Department were transferred to the Blending Department, $652,000. f Units that were complete with respect to processing in the Blending Department were transferred to Finished Goods, $760,000 g. Completed units were sold on account, $1,330,000. The Cost of Goods Sold was $610,000. 2 Post the journal entries from (0 above to T-accounts. The following account balances existed at the beginning of March. (The beginning balance.in the Refining Department's Work in Process is given in the T-account shown above) Raw materials Work in process-Blending Department Finished goods $205,660 $ 59,888 $24,00? Complete this question by entering your answers in the tabs below

Explanation / Answer

a WIP Refining A/c Dr 146600 WIP blending A/c Dr 46000 To Raw Material 192600 b WIP Refining A/c Dr 70200 WIP blending A/c Dr 16700 To Salay & Wages 86900 c Manufacturing Overhead 706000 To Accounts Payable 706000 d WIP Refining A/c Dr 474000 WIP blending A/c Dr 111000 To Manufacturing Overhead 585000 e WIP blending A/c Dr 652000 To WIP Refining A/c 652000 f Finished Goods 760000 To WIP Blending A/c 760000 g Accounts Receivable A/c DR 1330000 To Sales 1330000 COGS A/c Dr 610000 To Finished Goods' 610000 Raw Material Acount WIP Blending Account Balance B/d 205600 WIP Refining A/c 146600 Balance B/d 59000 Finished Goods 760000 WIP blending A/c 46000 Raw Material A/c 46000 Salary & Wages 16700 Manufacturing Overead 111000 Closing WIP Blending 124700 WIP Refining A/c 652000 884700 884700 WIP Refining Account Manufacturing Overhead A/c Bal B/d 32100 WIP Refining A/c 474000 Raw Material A/c 146600 WIP Blending A/c 652000 Accounts Payable 706000 WIP blending A/c 111000 Salary & Wages 70200 Manufacturing Overead 474000 Closing WIP refining A/c 70900 Under absorbed overhead 121000 (baancing figure) Total 722900 722900 706000 232000 Finished Goods A/c COGS A/c Balance B/d 24000 COGS 610000 By Fiished Goods 610000 WIP Blending Account 760000 Closing Balance of Finished Goods 174000 (BalancingFigure) 784000 784000 Sales Accounts Payable A/c Accounts Receivable /Ac 133000 Manufacturing Overhead 706000 Accounts Receivables A/c Salary & Wages Sales 1330000 WIP Refining A/c 70200 WIP blending A/c 16700

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