Managerial Accounting Midterm - Journal entries

April insurance cost for the manufacturing property and equipment was $2,250. The premium has been paid in January and properly recorded as a deferred asset.

Dr. Factory overhead inventory, Cr. Prepaid Insurance $2,250

Recorded $1,340 depreciation on an administrative asset

Dr. Depreciation expense, Cr. Accumulated depreciation $1,340

Purchased 21 lbs of high-grade polishing materials at $16 per lbs.

Dr. RMI, Cr. A/P $336

Paid factory utility bill, $6,870 in cash

Dr. Factory OH Inventory, Cr. Cash $6,780

Incurred 4,000 hours and paid payroll costs of $160,000. Of this amount, 1,000 hours and $20,000 was indirect.

Dr. WIP Inventory $140,000 Dr. Factory Inventory $20,000, Cr. Wages Payable $160,000

Applied Factory overhead to production on the basis of DLH (use normal costing)

Dr. WIP Inventory ($14.50 × 3,000 DLH), Cr. Factory OH Inventory $43,500

Incurred and paid other factory overhead costs $6,450

Dr. Factory OH Inventory, Cr. Cash $6,450

Purchases $29,000 of materials. DM included unpoloished semiprecious stones and gold. IM included supplies+ polishing materials

Dr. RMI, Cr. A/P $29,000

Requisitioned $23,000 of DM and $2,500 of IM from materials inventory

Dr. WIP Inventory $23,000 Dr. Factory OH Inventory 2,500, Cr. Raw Matrials Inventory $25,500

Incurred miscellaneous selling and admin expenses, $6,920

Dr. Selling and admin, Cr. A/P $6,920

Incurred $4,450 depreciation on manufacturing equipment for April

Dr. Factory OH Inventory, Cr. Accumulated Depreciation $4,450

Paid advertising expense in cash, $3,325

Dr. Selling and admin expense, Cr. Cash $3,325

Completed goods costing $68,500 during the month

Dr. FGI, Cr. WIP Inventory $68,500

Made Sales on account in April, $68,300. The COGS was $55,420

Dr. A/R 68,300 Dr. COGS $55,420, Cr. Sales Revenue $68,300 Cr. FGI $55,420