Entries for Process Cost System Cincinnati Soap Company manufactures powdered de

Question

Entries for Process Cost System Cincinnati Soap Company manufactures powdered detergent. Phosphate is placed in process in the Making Department, where it is turned into granulars. The output of Making is transferred to the Packing Department, where the packaging is added at the beginning of the process. On July 1, Cincinnati Soap Company had the following inventories: Finished Goods $15,250 Work in Process—Making 5,930 Work in Process—Packing 7,730 Materials 3,350 Departmental accounts are maintained for factory overhead, which both have zero balances on July 1. Manufacturing operations for July are summarized as follows: a. Materials purchased on account $189,970 b. Materials requisitioned for use Phosphate—Making Department $125,490 Packaging—Packing Department 43,650 Indirect materials—Making Department 4,910 Indirect materials—Packing Department 1,760 c. Labor used Direct labor—Making Department $89,650 Direct labor—Packing Department 60,510 Indirect labor—Making Department 17,360 Indirect labor—Packing Department 31,120 d. Depreciation charged on fixed assets Making Department $16,370 Packing Department 13,520 e. Expired prepaid factory insurance Making Department $3,100 Packing Department 1,240 f. Applied factory overhead Making Department $42,780 Packing Department 47,270 g. Production costs transferred from Making Department to Packing Department $258,660 h. Production costs transferred from Packing Department to Finished Goods $407,090 i. Cost of goods sold during the period $408,580 Required: 1. Journalize the entries to record the operations, identifying each entry by letter. For a compound transaction, if an amount box does not require an entry, leave it blank. Item Account Debit Credit a. b. c. d. e. f. g. h. i. 2. Compute the July 31 balances of the inventory accounts. Materials $ Work in Process—Making Department $ Work in Process—Packing Department $ Finished Goods $ 3. Compute the July 31 balances of the factory overhead accounts. If required, use the minus sign to indicate a credit balance. Factory Overhead—Making Department $ Factory Overhead—Packing Department $

Explanation / Answer

Trans Accounts Title Dr Cr a Raw Material Inventory 189970 Acccounts Payable 189970 b Work In process-Making Department 125490 Work In process-Packing Department 43650 Factory overhead-Making Dept 4910 Factory overhead-Packing Dept 1760 Raw Material Inventory 175810 c Work In process-Making Department 89650 Work In process-Packing Department 60510 Factory overhead-Making Dept 17360 Factory overhead-Packing Dept 31120 Factory Labor 198640 d Factory overhead-Making Dept 16370 Factory overhead-Packing Dept 13520 Accumulated Depreciation 29890 e Factory overhead-Making Dept 3100 Factory overhead-Packing Dept 1240 Prepaid Insurance 4340 f Work In process-Making Department 42780 Work In process-Packing Department 47270 Factory overhead-Making Dept 42780 Factory overhead-Packing Dept 47270 g Work In process-Packing Department 258660 Work In process-Making Department 258660 h Finished Goods Inventory 407090 Work In process-Packing Department 407090 i) Cost of Good sold 408580 Finished Goods Inventory 408580 ans 2 Raw Material Inventory 17510 (3350+189970-175810) Work In process-Making Department 5190 Work In process-Packing Department 10730 Finsihed Goods 13760 (15250+407090-408580) ans3 Factory Overhead-Making dept -1040 (4910+17360+16370+3100-42780) Factory Overhead-Packing dept 370 (1760+31120+13520+1240-47270)

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