Lubricants Inc produces a special kind of grease that is wid

Lubricants, Inc., produces a special kind of grease that is widely used by race car drivers. The grease is produced in two processing departments-Refining and Blending. Raw materials are introduced at various points in the Refining Department. The following incomplete Work in Process account is available for the Refining Department for March: Work in Process-Refining Department 33,900Completed and transferred to Blending March 1 balance Materials Direct labor Overhead 151,600 77,200 488,000 March 31 balance The March 1 work in process inventory in the Refining Department consists of the following elements: materials, $8,200; direct labor $4,500, and overhead, $21,200. Costs incurred during March in the Blending Department were: materials used, $45,000; direct labor, $17,800; and overhead cost applied to production, $107,000.

Solution

Answer 1. Weighted Average Method Journal Entry Date Particulars Dr. Amt. Cr. Amt. a. WIP- Refining Department        151,600.00 WIP- Blending Department          45,000.00 Raw Materials        196,600.00 (record the raw materials used in production) b. WIP- Refining Department          77,200.00 WIP- Blending Department          17,800.00 Salaries & Wages Payable          95,000.00 (record the direct labor incurred) c. Manufacturing Overhead        696,000.00 Accounts Payable        696,000.00 (Record the manufacturing overhead incurred) d. WIP- Refining Department        488,000.00 WIP- Blending Department        107,000.00 Manufacturing Overhead        595,000.00 (record the maufactuing overhead applied) e. WIP - Blending Department        672,000.00 WIP - Reining Department        672,000.00 (record the WIP completed in refining department transf. to Blending Departent) f. Finished Goods Inventory        790,000.00 WIP - Blending Department        790,000.00 (record the goods completed) g-1. Accounts Receivable    1,390,000.00 Sales    1,390,000.00 (record the goods sold) g-2. Cost o Goods Sold        650,000.00 Finished Goods Inventory        650,000.00 (Record the cost of goods sold Answer 2. WIP - Refining Department Raw Materials Mar 1 Balance      33,900.00 Completed & Transff. to Blending €    672,000.00 Mar 1 Balance    212,600.00 WIP - Refining    151,600.00 Materials (a)    151,600.00 WIP - Blending      45,000.00 Direct Labor (b)      77,200.00 Overhead (d)    488,000.00 Mar 31, Balance      78,700.00 Mar 31, Balance      16,000.00 WIP - Blending Department Finished Goods Mar 1 Balance      41,000.00 Finished goods (f)    790,000.00 Mar 1 Balance      14,000.00 Cost of Goods Sold (g-2)    650,000.00 Materials (a)      45,000.00 WIP - Blending (f)    790,000.00 Direct Labor (b)      17,800.00 Overhead (d)    107,000.00 WIP - Refinning €    672,000.00 Mar 31, Balance      92,800.00 Mar 31, Balance    154,000.00