Question

Required information The following information applies to the questions displayed below.) The following information is available for Lock-Tite Company, which produces special-order security products and uses a job order costing system. April 30 May 31 $ $42,000 9,500 63,000 54,000 20,600 34,100 Inventories Raw materials Work in process Finished goods Activities and information for May Raw materials purchases (paid with cash) Factory payroll (paid with cash) Factory overhead Indirect materials Indirect labor Other overhead costs Sales (received in cash) Predetermined overhead rate based on direct labor cost 196,000 200,000 16,000 46,000 118,000 1,200,000 55% 1. Incurred other overhead costs (record credit to Other Accounts). 2. Applied overhead to work in process.

Answer 1

Lock Tite Company Journal Enteries Trans. Particulars 1 Factory Overhead a/c To Other accounts (Incurred other overhead costs) Dr. Debit in $ Credit in $ 118000 118000 2 Work in Process Inventory a/c Dr. 84700 To Factory Overhead (Application of overhead to Work in process) 84700 Cost of Direct Labor used Total Factory Payroll Less:Indirect Labor Cost of Direct Labor used 200000 - 46000 154000 Factory Overhead = 154000 x 55% 84700