Production cost flow and measurement

Production cost flow and measurement Student Help Problem 20-1A Production cost flow and measurement; journal entries L.O. P1, P2, P3, P4
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Edison Company manufactures wool blankets and accounts for product costs using process costing. The following information is available regarding its May inventories.

Beginning Inventory

Ending Inventory

Raw materials inventory
$
60,000

$
41,000

Goods in process inventory

449,000

521,500

Finished goods inventory

610,000

342,001

The following additional information describes the company’s production activities for May.

Raw materials purchases (on credit)
$
250,000

Factory payroll cost (paid in cash)

1,850,300

Other overhead cost (Other Accounts credited)

82,000

Materials used

Direct
$
200,500

Indirect

50,000

Labor used

Direct
$
1,060,300

Indirect

790,000

Overhead rate as a percent of direct labor

115
%

Sales (on credit)
$
3,000,000

The predetermined overhead rate was computed at the beginning of the year as 115% of direct labor cost.

\ rev: 11_02_2011
references

1.
value: 2.00 points

Problem 20-1A Part 1

Required:

1(a)
Compute the cost of products transferred from production to finished goods. (Omit the “$” sign in your response.)

Cost of products transferred
$

1(b)
Compute the cost of goods sold. (Omit the “$” sign in your response.)

Cost of goods sold
$

rev: 10_31_2011
check my work eBook Links (4) references

2.
value: 5.00 points

Problem 20-1A Part 2

2(a)
Prepare journal entry dated May 31 to record the raw materials purchases. (Omit the “$” sign in your response.)