Question

Jurvin Enterprises recorded the following transactions for the just completed month. The company had no beginning inventories.

  

a.	$75,100 in raw materials were purchased for cash.
b.	$72,000 in raw materials were requisitioned for use in production. Of this amount, $65,900 was for direct materials and the remainder was for indirect materials.
c.	Total labor wages of $151,300 were incurred and paid. Of this amount, $133,400 was for direct labor and the remainder was for indirect labor.
d.	Additional manufacturing overhead costs of $125,200 were incurred and paid.
e.	Manufacturing overhead costs of $128,200 were applied to jobs using the company’s predetermined overhead rate.
f.	All of the jobs in progress at the end of the month were completed and shipped to customers.
g.	Any underapplied or overapplied overhead for the period was closed out to Cost of Goods Sold.

   

Required:
1.	Post the above transactions to T-accounts.

      

2.	Determine the cost of goods sold for the period.

      

Answer 1

SOLUTION

1.

Cash Account

Particulars	Amount ($) (Dr.)	Particulars	Amount ($) (Cr.)
		A	75,100
		C	151,300
		D	125,200

Raw Material Account

Particulars	Amount ($) (Dr.)	Particulars	Amount ($) (Cr.)
A	75,100	B	72,000

Work in Process Account

Particulars	Amount ($) (Dr.)	Particulars	Amount ($) (Cr.)
B	65,900
C	133,400
E	128,200	F	327,500

Finished goods inventory Account

Particulars	Amount ($) (Dr.)	Particulars	Amount ($) (Cr.)
F	327,500	G	327,500

Manufacturing Overhead Account

Particulars	Amount ($) (Dr.)	Particulars	Amount ($) (Cr.)
B ($72,000-$65,900)	6,100	E	128,200
C ($151,300-$133,400)	17,900
D	125,200	H	21,000

Cost of goods sold Account

Particulars	Amount ($) (Dr.)	Particulars	Amount ($) (Cr.)
G	327,500
H	21,000
		Balance	348,500

2. Cost of goods sold for the period - $348,500