Laffer Lumber produces bagged bark for use in landscaping. Production involves p

Question

Laffer Lumber produces bagged bark for use in landscaping. Production involves packaging bark chips in plastic bags in a bagging department. The following information describes production operations for October. The company's revenue for the month totaled $440,000 from credit sales, and its cost of goods sold for the month is $258,000. Prepare summary journal entries dated October 31 to record its October production activities for direct material usage. direct labor incurred overhead allocation. goods transfer from production to finished goods, and credit sales. Record direct materials used in production. Record direct labor used in production, but not yet paid. Record overhead applied to production. Record the transfer of goods from production to finished goods. Record the sale of goods on account. Record the cost of goods sold.

Explanation / Answer

1) work in progress a/c Dr. 234000

To direct materials a/c 234000

2)

work in progress a/c Dr. 40000

To direct labor a/c 40000

3)Work in progress a/c Dr. 44000

To overhead expenses a/c 44000

4)Finished goods a/c Dr. 201000

To Work in progress a/c 201000

5)accounts receivable a/c Dr. 440000

To sales a/c 440000

6) Cost of goods sold a/c Dr .201000

To Finished goods a/c 201000

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