Question

Portside Watercraft uses a job order costing system. During one month Portside purchased $173,000 of raw materials on credit; issued materials to production of $164,000, of which $24,000 were indirect. Portside incurred a factory payroll cost of $95,000, of which $25,000 was indirect labor. Portside uses a predetermined overhead rate of 170% of direct labor cost. The journal entry to record the issuance of materials to production is:

Answer 1

Answer:

Debit Work in Process Inventory $140,000

Debit Factory Overhead $24,000

Credit Raw Materials Inventory $164,000.

Explanation:

Preparation of The journal entry to record the issuance of materials to production

Based on the information given The journal entry to record the issuance of materials to production is:

Debit Work in Process Inventory $140,000

($164,000-$24,000)

Debit Factory Overhead $24,000

Credit Raw Materials Inventory $164,000

(To record the issuance of materials to production)