make sure to do all parts Entries for Process Cost System Pr

make sure to do all parts

Entries for Process Cost System

Preston & Grover Soap Company manufactures powdered detergent. Phosphate is placed in process in the Making Department, where it is turned into granulars. The output of Making is transferred to the Packing Department, where packaging is added at the beginning of the process. On July 1, Preston & Grover Soap Company had the following inventories:

Departmental accounts are maintained for factory overhead, which both have zero balances on July 1.

Manufacturing operations for July are summarized as follows:

Required:

1. Journalize the entries to record the operations, identifying each entry by letter. For a compound transaction, if an amount box does not require an entry, leave it blank.

2. Compute the July 31 balances of the inventory accounts.

3. Compute the July 31 balances of the factory overhead accounts.

Finished Goods	$15,380
Work in Process—Making	5,980
Work in Process—Packing	7,790
Materials	3,380

Solution

Date Accounts title and explanation Debit Credit a Materials $191,500 Accounts Payable $191,500 b Work in Process—Making Department $126,500 Work in Process—Packing Department $ 44,000 Factory Overhead—Making Department $    4,950 Factory Overhead—Packing Department $    1,780 Materials $177,230 c Work in Process—Making Department $ 90,380 Work in Process—Packing Department $ 61,000 Factory Overhead—Making Department $ 17,500 Factory Overhead—Packing Department $ 31,380 Wages Payable $200,260 d Factory Overhead—Making Department $ 16,500 Factory Overhead—Packing Department $ 13,630 Accumulated Depreciation $ 30,130 e Factory Overhead—Making Department $    3,130 Factory Overhead—Packing Department $    1,250 Prepaid Insurance $    4,380 f Work in Process—Making Department $ 43,130 Work in Process—Packing Department $ 47,650 Factory Overhead—Making Department $ 43,130 Factory Overhead—Packing Department $ 47,650 g Work in Process—Packing Department $260,750 Work in Process—Making Department $260,750 h Finished Goods $410,380 Work in Process—Packing Department $410,380 i Cost of Goods Sold $411,880 Finished Goods $411,880 2 Materials Work in Process - Making Dept. Work in Process - Packing Dept. Finished Goods Balance, October 1 $    3,380 $    5,980 $    7,790 $ 15,380 Debits    191,500    260,010    413,400    410,380 Credits (177,230) (260,750) (410,380) (411,880) Balance, October 31 $ 17,650 $    5,240 $ 10,810 $ 13,880 1 $126,500 + $90,380 + $43,130 2 $44,000 + $61,000 + $47,650 + $260,750 3 Factory Overhead —making Dept. Factory Overhead —Packing Dept. Balance, October 1 $               -   $               -   Debits          42,080          48,040 Credits        (43,130)        (47,650) Balance, October 31          (1,050)                390 1 $4,950 + $17,500 + $16,500 + $3,130 2 $1,780 + $31,380 + $13,630 + $1,250