Question

1. Journal Entries

   Shorts Company has three process departments: Mixing, Encapsulating, and Bottling. At the beginning of the year, there were no work-in-process or finished goods inventories. The following data are available for the month of July:

   Department		Manufacturing Costs Added*		Ending Work in Process
   Mixing		$87,500		$21,320
   Encapsulating		75,570		19,810
   Bottling		72,470		4,320

   *Includes only the direct materials, direct labor, and the overhead used to process the partially finished goods received from the prior department. The transferred-in cost is not included.

   Required:

   1. Prepare journal entries that show the transfer of costs (a) from Mixing to Encapsulating, (b) from Encapsulating to Bottling, and (c) from Bottling to finished goods inventory.

   a.
   b.
   c.

   2. Post the entries made in Requirement 1 into the T-accounts below. The costs added from the data provided have been entered in the T-accounts.

   WIP—Mixing
   	87,500
   	21,320

   WIP—Encapsulating
   	75,570
   	19,810

   WIP—Bottling
   	72,470
   	4,320

   Finished Goods

Answer 1