Homework SourseSweeties Inc manufactures a sugar product by a continuous pr
Sweeties, Inc., manufactures a sugar product by a continuous process involving three production departments—Refining, Sifting, and Packing. Assume that records indicate that direct materials, direct labor, and applied factory overhead for the first department, Refining, were $381,000, $149,000, and $96,200, respectively. Also, work in process in the Refining Department at the beginning of the period totaled $30,000, and work in process at the end of the period totaled $28,600.
Required:
| A. |
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| B. | On September 30, journalize the entry to record the transfer of production costs to the second department, Sifting.* | ||||||
| * | Refer to the Chart of Accounts for exact wording of account titles. |
Solution
Note: Kindly confirm the exact wording of account titles per the chart of accounts since the same is not provided with the question.
Transfer of production costs from Refining to Sifting = $30000 + $381000 + $149000 + $96200 - $28600 = $627600
| Transaction | Date | General Journal | Debit | Credit |
| A.(1) | Sep. 30 | Work in process-Refining department | 381000 | |
| Raw materials inventory | 381000 | |||
| (To record direct materials used) | ||||
| A.(2) | Sep. 30 | Work in process-Refining department | 149000 | |
| Wages payable | 149000 | |||
| (To record direct labor costs incurred) | ||||
| A.(3) | Sep. 30 | Work in process-Refining department | 96200 | |
| Factory overhead | 96200 | |||
| (To record factory overheads applied) | ||||
| B. | Sep. 30 | Work in process-Sifting department | 627600 | |
| Work in process-Refining department | 627600 | |||
| (To record costs transferred to Sifting department) |
