Three individuals form Skylark Corporation with the following contributions: Cliff, cash of $50,000 for 50 shares; Brad, land wo
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Answer:
Goldnest company
A. Journal entries
1.Raw Materials Purchased.
Debit Direct Raw materials Account with $ 169,000
Credit Accounts Payable Account with $ 169,000
2.Labour Costs incurred
Debit Direct labor with $ 156,000
Debit Indirect labor with $ 182,000
Debit Sales commissions with $ 25,000
Debit Administrative salaries with $ 45,000
Credit Cash with $ 408,000
3.Rentals Costs for the year
Debit Factory Rent for the year with $13,900
Debit Office Rent for the year with $5,900
Credit Cash Account with $18,900
4. Utility costs incurred in the factory
Debit Factory Utility Account with $20,000
Credit Cash Account with $20,000
5.Advertising Expense Incurred
Debit Advertising Expense Account with $15,000
Credit Cash Account with $15,000
6. Depreciation recorded on equipment
Debit Depreciation on Factory equipment with $15,000
Debit Depreciation on Office equipment with $6,000
Credit Accumulated depreciation with $21,000
7.Sales in the Year
Debit Cash Account with $509,000
Credit Sales with $509,000
B. T Accounts are included in the attached for your understanding
C. Manufacturing overhead has been over applied by $34,300. Workings of this has been attached for your understanding
D.income statement closes with a net profit of $195,000. Refer to attached for detailed breakdown
Explanation:
