Crawford Corporation incurred the following transactions 1 P

Crawford Corporation incurred the following transactions. 1. Purchased raw materials on account $46,400. 2. Raw Materials of $36,100 were requisitioned to the factory. An analysis of the materials requisition slips indicated that $6,900 was classified as indirect materials. 3. Factory labor costs incurred were $60,000, of which $50,000 pertained to factory wages payable and $10,000 pertained to employer payroll taxes payable. 4. Time tickets indicated that $54,100 was direct labor and $5,900 was indirect labor. 5. Manufacturing overhead costs incurred on account were $81,500. 6. Depreciation on the company’s office building was $8,100. 7. Manufacturing overhead was applied at the rate of 150% of direct labor cost. 8. Goods costing $89,000 were completed and transferred to finished goods. 9. Finished goods costing $75,100 to manufacture were sold on account for $104,000.

Solution

1. Raw Materials Inventory 46,400
Accounts Payable 46,400
2. Work in Process Inventory 29,200
Manufacturing Overhead ?6,900
Raw Materials Inventory 36,100
3. Factory Labor ?60,000
Factory Wages Payable ?. 50,000
Employer Payroll Taxes Payable ?10,000
4. Work in Process Inventory ?54,100
Manufacturing Overhead ?. ?5,900
Factory Labor ?. 60,000
5. Manufacturing Overhead ?81,500
Accounts Payable ?81,500
6. Depreciation Expense 8,100
Accumulated Depreciation—Building 8,100
7. Work in Process Inventory ($54,100 X 150%) ?81,150
Manufacturing Overhead ?81,150
8. Finished Goods Inventory ?89,000
Work in Process Inventory ?89,000
9. Accounts Receivable 104,000
Sales Revenue 104,000
Cost of Goods Sold ?75,100
Finished Goods Inventory ?75,100