Question

The following transactions occurred in April at Steve’s Cabinets, a custom cabinet firm: Purchased $80,000 of materials on account. Issued $4,000 of supplies from the materials inventory. Purchased $56,000 of materials on account. Paid for the materials purchased in transaction (1) using cash. Issued $68,000 in direct materials to the production department. Incurred direct labor costs of $100,000, which were credited to Wages Payable. Paid $106,000 cash for utilities, power, equipment maintenance, and other miscellaneous items for the manufacturing plant. Applied overhead on the basis of 125 percent of $100,000 direct labor costs. Recognized depreciation on manufacturing property, plant, and equipment of $50,000. The following balances appeared in the accounts of Steve’s Cabinets for April: Beginning Ending Materials Inventory $ 148,200 ? Work-in-Process Inventory 33,000 ? Finished Goods Inventory 166,000 $ 143,200 Cost of Goods Sold 263,400 Required: a. Prepare journal entries to record the transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Answer 1

Answer:

Account                            Debit            Credit

Materials                          $8,000

Accounts Payable                                 $8,000

Supplies                           $4,000

Materials                                                $4,000

Materials                           $56,000

Accounts Payable                                 $56,000

Cash                                                       $8,000

Accounts Payable            $8,000

Supplies                            $68,000

Materials                                                $68,000

Direct Labor Costs           $100,000

Wages Payable                                     $100,000

Cash                                  $106,000

Utilities expense                                   $106,000

Work in Process Overhead $125,000

Direct labor costs                                  $125,000

Depreciation Expense          $50,000

Accumulated Depreciation                  $50,000