Question

Eppich Corporation has provided the following data for the most recent month:

Raw materials, beginning balance	$	19,500
Work in process, beginning balance	$	32,400
Finished Goods, beginning balance	$	50,400

Transactions:

(1)	Raw materials purchases	$	79,300
(2)	Raw materials used in production (all direct materials)	$	77,700
(3)	Direct labor	$	52,400
(4)	Manufacturing overhead costs incurred	$	91,500
(5)	Manufacturing overhead applied	$	72,400
(6)	Cost of units completed and transferred from Work in Process to Finished Goods	$	190,000
(7)	Any overapplied or underapplied manufacturing overhead is closed to Cost of Goods Sold		?
(8)	Finished goods are sold	$	221,100

Required:

Complete the following T-accounts by recording the beginning balances and each of the transactions listed above. Raw Materials, Work in Progress, Finished Goods, Manufacturing Overhead, and Cost of Goods Sold.

Answer 1

Raw Materials Inventory					Work in Process Inventory
	Debit	Credit				Debit	Credit
Beg. Bal.	19500				Beg. Bal.	32400
Purchases (1)	79300	77700	Requisitions (2)		Direct Materials (2)	77700	190000	Completed and transferred (6)
		21100	End. Bal.		Direct labor (3)	52400
					Manufacturing overhead (5)	72400	44900	End. Bal.
Finished Goods Inventory					Manufacturing Overhead
	Debit	Credit				Debit	Credit
Beg. Bal.	50400				Manufacturing overhead (4)	91500	72400	Overheads applied (5)
Completed (6)	190000	221100	Cost of goods sold				19100	Underapplied overheads (7)
		19300	End. Bal.
Cost of Goods Sold (COGS)
	Debit	Credit
Finished goods sold (8)	221100
Underapplied overheads (7)	19100