Problem 3-5 Lakeland Solvent produces a single product in two departments. The f
ID: 2423412 • Letter: P
Question
Problem 3-5
Lakeland Solvent produces a single product in two departments. The following costs relate to April:
Prepare journal entries to record: (Credit account titles are automatically indented when the amount is entered. Do not indent manually.)
No.
Account Titles and Explanation
Debit
Credit
a.
(To record material used in department 1)
(To record material used in department 2)
b.
(To record labor in department 1)
(To record labor in department 2)
c.
(To record overhead applied in department 1)
(To record overhead applied in department 2)
d.
(To record cost of units transferred from department 1 to department 2)
(To record cost units completed and transferred to finished goods.)
Department 1 Department 2 WIP, March 31 $22,800 $43,000 Costs added during April Direct material 87,900 17,000 Direct labor 39,500 73,000 Manufacturing overhead 210,000 108,000 Transferred-in costs N/A ? WIP, April 30 0 28,900Explanation / Answer
No.
Account Titles and Explanation
Debit
Credit
a)
Work in process inventory
87,900
Raw material inventory
87,900
(To record material used in department 1)
Work in process inventory
17,000
Raw material inventory
17,000
(To record material used in department 2)
b)
work in process inventory
39,500
wages payable
39,500
(To record labor in department 1)
work in process inventory
73,000
wages payable
73,000
(To record labor in department 2)
c)
work in process inventory
210,000
Manufacturing overhead
210,000
(To record overhead applied in department 1)
work in process inventory
108,000
Manufacturing overhead
108,000
(To record overhead applied in department 2)
d)
Receiving department (department 2)
360,200
Supplying department (department 1)
360,200
(To record cost of units transferred from department 1 to department 2)
Finished goods inventory
572300
Work in process inventory
572300
(To record cost units completed and transferred to finished goods.)
No.
Account Titles and Explanation
Debit
Credit
a)
Work in process inventory
87,900
Raw material inventory
87,900
(To record material used in department 1)
Work in process inventory
17,000
Raw material inventory
17,000
(To record material used in department 2)
b)
work in process inventory
39,500
wages payable
39,500
(To record labor in department 1)
work in process inventory
73,000
wages payable
73,000
(To record labor in department 2)
c)
work in process inventory
210,000
Manufacturing overhead
210,000
(To record overhead applied in department 1)
work in process inventory
108,000
Manufacturing overhead
108,000
(To record overhead applied in department 2)
d)
Receiving department (department 2)
360,200
Supplying department (department 1)
360,200
(To record cost of units transferred from department 1 to department 2)
Finished goods inventory
572300
Work in process inventory
572300
(To record cost units completed and transferred to finished goods.)
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