Question

Starr Company reports the following information for August. Raw materials purchased on account $ 86,200 Direct...

Starr Company reports the following information for August.

Raw materials purchased on account $ 86,200
Direct materials used in production $ 54,600
Factory wages earned (direct labor) $ 19,100
Overhead rate 125 % of direct labor cost


Prepare journal entries to record the following events.

1. Raw materials purchased.
2. Direct materials used in production.
3. Direct labor used in production.
4. Applied overhead.

Business   Accounting   
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Answer #1

Journal entry :

Date accounts & explanation debit credit
Raw material inventory 86200
Account payable 86200
(To record raw materials purchased)
Work in process 54600
Raw material inventory 54600
(To record direct materials used in production)
Work in process 19100
Wages payable 19100
(To record direct labour used in production)
Work in process (19100*125%) 23875
Manufacturing overhead 23875
(To record applied overhead)
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