Direct labor costs were incurred

Assignment Help Financial Accounting

Reference no: EM13940596

Nature's Way, Inc., keeps one of its production facilities busy making a perfume called Essence de la Vache. The perfume goes through two processing departments: Blending and Bottling. The following incomplete Work in Process account is provided for the Blending Department for March: Work in Process-Blending March 1 balance 31,700 Completed and transferred to Bottling (760,000 ounces)? Materials 138,600 Direct labor 77,200 Overhead 485,000 March 31 balances? The $31,700 beginning inventory in the Blending Department consisted of the following elements: materials, $8,000; direct labor, $3,800; and overhead applied, $19,900. Costs incurred during March in the Bottling Department were: materials used, $44,000; direct labor, $16,200; and overhead cost applied to production, $109,000. Required: 1. Prepare journal entries to record the costs incurred in both the Blending Department and Bottling Department during March.

a. Raw materials were issued for use in production.

b. Direct labor costs were incurred.

c. Manufacturing overhead costs for the entire factory were incurred, $636,000. (Credit Accounts Payable and use a single Manufacturing Overhead control account for the entire factory.)

d. Manufacturing overhead was applied to production using a predetermined overhead rate.

e. Units that were complete with respect to processing in the Blending Department were transferred to the Bottling Department, $652,000.

f. Units that were complete with respect to processing in the Bottling Department were transferred to Finished Goods, $750,000.

g. Completed units were sold on account for $1,480,000. The cost of goods sold was $680,000.

Reference no: EM13940596

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