Question

The Polaris Company uses a job order costing system. The following transactions occurred in October a. Raw materials purchased on account, $210,000 b. Raw materials used in production, $189.000 (S151.200 direct materials and $37.800 indirect materials). c. Accrued direct labor cost of $49,000 and indirect labor cost of $21.000. d. Depreciation recorded on factory equipment. $105.000. e. Other manufacturing overhead costs accrued during October $131,000. . The company applies manufacturing overhead cost to production using a predetermined rate of $6 per machine hour A total of 76,200 machine-hours were used in October. Jobs costing $513,000 according to their job cost sheets were completed during October and transferred to Finished Goods h. Jobs that had cost $451000 to complete according to their job cost sheets were shipped to customers during the month These jobs were sold on account at 24% above cost Required: 1. Prepare journal entries to record the transactions given above. 2. Prepare T-accounts for Manufacturing Overhead and Work in Process Post the relevant transactions from above to each account Compute the ending balance in each account, assuming that Work in Process has a beginning balance of $34.000 Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare journal entries to record the transactions given above. (If no entry is required for a transaction/event, select "No journal entry required in the first account field.)

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Answer 1

Answer
1
No	Transactions	General Journal	Debit	Credit
1	a.	Raw materials inventory	$        210,000
		Accounts payable		$         210,000
2	b.	Work in process	$        151,200
		Manufacturing overhead	$          37,800
		Raw materials inventory		$         189,000
3	c.	Work in process	$          49,000
		Manufacturing overhead	$          21,000
		Salaries and wages payable		$           70,000
4	d.	Manufacturing overhead	$        105,000
		Accumulated depreciation		$         105,000
5	e.	Manufacturing overhead	$        131,000
		Accounts payable		$         131,000
6	f.	Work in process	$        457,200		($6 x 76,200 MHs)
		Manufacturing overhead		$         457,200
7	g.	Finished goods	$        513,000
		Work in process		$         513,000
8	h(1)	Cost of goods sold	$        451,000
		Finished goods		$         451,000
9	h(2)	Accounts receivable	$        559,240		(451000 x 124%)
		Sales		$         559,240

Manufacturing Overhead
b	$        37,800	$        457,200	f
c	$        21,000
d	$      105,000
e	$      131,000
End bal		$        162,400
Work in process
Beg Bal	$        34,000
b	$      151,200	$        513,000	g
c	$        49,000
f	$      457,200
End Bal	$      178,400