Question

Radford Inc. manufactures a sugar product by a continuous process, involving three production departments-Refining, Sifting, and Packing. Assume that records indicate that direct materials, direct labor, and applied factory overhead for the first department, Refining, were $381,000, $149,000, and $96,200, respectively. Also, work in process in the Refining Department at the beginning of the period totaled $30,000, and work in process at the end of the period totaled $28,600.
A.
(1) On September 30, journalize the entry to record the flow of costs into the Refining Department during the period for direct materials.*
(2) On September 30, journalize the entry to record the flow of costs into the Refining Department during the period for direct labor.*
(3) On September 30, journalize the entry to record the flow of costs into the Refining Department during the period for factory overhead.*
B. On September 30, journalize the entry to record the transfer of production costs to the second department, Sifting.*
* Refer to the Chart of Accounts for exact wording of account titles.

Answer 1

Answer:

1.

Dr Work-in process - Refining Department $381,000

Cr Materials $381,000

2

Dr Work-in process - Refining Department $149,000

Cr Wages Payable $149,000

3

Dr Work-in process - Refining Department $96,200

Cr Factories Overhead - Refining Department $96,200

b.

Dr Work-in process - Sifting Department

$627,600

Cr Work-in process - Refining Department $627,600

Explanation:

Radford Inc. Journal Entries to record the flow of costs into the refining department

1.

Dr Work-in process - Refining Department $381,000

Cr Materials $381,000

(To record usage of direct material)

2

Dr Work-in process - Refining Department $149,000

Cr Wages Payable $149,000

(To record usage of direct labor)

3

Dr Work-in process - Refining Department $96,200

Cr Factories Overhead - Refining Department $96,200

(To record applied manufacturing overhead)

b. Entry to record the transfer of production costs to the second department

Dr Work-in process - Sifting Department

$627,600

Cr Work-in process - Refining Department $627,600

(To transfer costs to the second department)

[$30,000 + ($381,000+$149,000+$96,200)- $28,600])

$30,000+$626,200-$28,600

=$30,000+$597,600

=$627,600