Exercise 207 Crawford Corporation incurred the following tra

Exercise 20-7 Crawford Corporation incurred the following transactions. 1. Purchased raw materials on account $53,000. 2. Raw Materials of $45,200 were requisitioned to the factory. An analysis of the materials requisition slips indicated that $9,400 was classified as indirect material 3. Factory labor costs incurred were $65,400, of which $50,200 pertained to factory wages payable and $15,200 pertained to employer payroll taxes payable. 4 Time tickets indicated that * 55,000 was direct labor and $10,400 was indirect labor. 5. Manufacturing overhead costs incurred on account were $81,700 6. Depreciation on the company\'s office building was $8,100 7, Manufacturing overhead was applied at the rate of 160% of direct labor cost. 8. Goods costing $89,400 were completed and transferred to finished goods 9. Finished goods costing $76,000 to manufacture were sold on account for $105,100.

Solution

Crawford Corporation General Journal Event Account Title Debit Credit 1 Raw Material 53000 Accounts Payable 53000 (To record purchase of raw material on account) 2 Work-in-porcess 35800 Manufacturing overhead 9400 Raw Material 45200 (To record raw material requisitioned by factory) 3 Factory wages expense 65400 Salaries and wages payable 65400 (Factory labor cost incured) 4 Work-in-porcess 55000 Manufacturing overhead 10400 Factory wages expense 65400 (To record factory labor cost assigned to production ) 5 Manufacturing overhead 81700 Accounts Payable 81700 (To record manufacturing overheads incurred on account) 6 Depreciation expense - office building 8100 Accumutaed depreciation - building 8100 (To record depreciation expense on office building) 7 Work-in-porcess 88000 Manufacturing overhead 88000 (To record manufacturing overheads applied - 160% of direct wages) 8 Finished goods 89400 Work-in-porcess 89400 (To record transfer of goods completed to finished goods) 9 Cost of goods sold 76000 Finished goods 76000 (To record cost of goods sold during the period ) Accounts Receivable 105100 Sales Revenue 105100 (To record sale of goods on account)