Li Company produces large quantities of a standardized product. The following information is available for its production activities for January.

Problem 20-3A Journalizing in process costing; equivalent units and costs L.O. C2, P1, P2, P3

[The following information applies to the questions displayed below.]

Li Company produces large quantities of a standardized product. The following information is available for its production activities for January.

Raw materials				Factory overhead incurred
Beginning inventory	$	19,000		Indirect materials used	$	81,000
Raw materials purchased (on credit)		315,000		Indirect labor used		50,000
Direct materials used		(172,000	)	Other overhead costs		151,380
Indirect materials used		(81,000	)	Total factory overhead incurred	$	282,380
Ending Inventory	$	81,000
				Factory overhead applied
Factory payroll				(140% of direct labor cost)
Direct labor used	$	201,700		Total factory overhead applied	$	282,380
Indirect labor used		50,000
Total payroll cost (paid in cash)	$	251,700

Additional information about units and costs of production activities follows.

Units			Costs
Beginning goods in process inventory	2,400		Beginning goods in process inventory
Started	24,000		Direct materials	$	3,500
Ending goods in process inventory	5,200		Direct labor		2,900
			Factory overhead		3,800
						$	10,200
Status of ending goods in process inventory			Direct materials added				172,000
Materials—Percent complete	80	%	Direct labor added				201,700
Labor and overhead—Percent complete	75	%	Overhead applied (140% of direct labor)				282,380
			Total costs			$	666,280
			Ending goods in process inventory			$	105,032

During January, 18,000 units of finished goods are sold for $140 cash each. Cost information regarding finished goods follows.

Beginning finished goods inventory	$	160,000
Cost transferred in		561,248
Cost of goods sold		(606,390	)
Ending finished goods inventory	$	114,858

Section Break

Problem 20-3A Journalizing in process costing; equivalent units and costs L.O. C2, P1, P2, P3

6.

award:
10 out of
10.00 points

Problem 20-3A Part 1

Required:
1(a)	Prepare journal entry dated January 31 to record the purchase of raw materials. (Omit the "$" sign in your response.)

Date	General Journal	Debit	Credit
Jan. 31	Raw materials inventory	315,000
	Accounts payable		315,000

1(b)	Prepare journal entry dated January 31 to record the direct materials usage. (Omit the "$" sign in your response.)

Date	General Journal	Debit	Credit
Jan. 31	Goods in process inventory	172,000
	Raw materials inventory		172,000

1(c)	Prepare journal entry dated January 31 to record the indirect materials usage. (Omit the "$" sign in your response.)

Date	General Journal	Debit	Credit
Jan. 31	Factory overhead	81,000
	Raw materials inventory		81,000

1(d)	Prepare journal entry dated January 31 to record the factory payroll costs. (Omit the "$" sign in your response.)

Date	General Journal	Debit	Credit
Jan. 31	Factory payroll	251,700
	Cash		251,700

1(e)	Prepare journal entry dated January 31 to record the direct labor costs used in production. (Omit the "$" sign in your response.)

Date	General Journal	Debit	Credit
Jan. 31	Goods in process inventory	201,700
	Factory payroll		201,700

1(f)	Prepare journal entry dated January 31 to record the indirect labor costs. (Omit the "$" sign in your response.)

Date	General Journal	Debit	Credit
Jan. 31	Factory overhead	50,000
	Factory payroll		50,000

1(g)	Prepare journal entry dated January 31 to record the other overhead costs—credit Other Accounts. (Omit the "$" sign in your response.)

Date	General Journal	Debit	Credit
Jan. 31	Factory overhead	151,380
	Other accounts		151,380

1(h)	Prepare journal entry dated January 31 to record the overhead applied. (Omit the "$" sign in your response.)

Date	General Journal	Debit	Credit
Jan. 31	Goods in process inventory	282,380
	Factory overhead		282,380

1(i)	Prepare journal entry dated January 31 to record the goods transferred to finished goods. (Omit the "$" sign in your response.)

Date	General Journal	Debit	Credit
Jan. 31	Finished goods inventory	561,248
	Goods in process inventory		561,248

1(j)	Prepare journal entries dated January 31 to record the sale of finished goods. (Omit the "$" sign in your response.)

Date	General Journal	Debit	Credit
Jan. 31	Cash	2,520,000
	Sales		2,520,000
	Cost of goods sold	606,390
	Finished goods inventory		606,390

Worksheet

Problem 20-3A Part 1

7.

award:
9.57 out of
11.00 points

Problem 20-3A Part 2

2.

Prepare a process cost summary report for this company, showing costs charged to production, units cost information, equivalent units of production, cost per EUP, and its cost assignment and reconciliation. (Due to rounding of cost per unit, the total costs accounted for in the cost summary may not equal to sum of all the costs given in the problem. Round your cost per EUP answers to 2 decimal places and consider the same in the other calculations. Round other answers to the nearest dollar amount. Omit the "$" sign in your response.)

LI COMPANY
Process Cost Summary
For Month Ended January 31
Costs Charged to Production
Costs of beginning goods in process
Direct materials	$
Direct labor
Factory overhead
		$ 10,200
Costs incurred this period
Direct materials	$
Direct labor
Factory overhead
		656,080
Total costs to account for		$ 666,280

Unit cost information
Units to account for		Units accounted for
Beginning goods in process		Completed & transferred out
Units started this period		Ending goods in process
Total units to account for	26,400	Total units accounted for	26,400

Equivalent units of production	Direct Materials	Direct Labor	Factory Overhead
Units completed & transferred out	21,200 EUP	21,200 EUP	21,200 EUP
Units of ending goods in process	4,160 EUP	3,900 EUP	3,900 EUP
Equivalent units of production	25,360 EUP	25,100 EUP	25,100 EUP

Cost per EUP	Direct Materials			Direct Labor			Factory Overhead
Cost of beginning goods in process	$	3,500		$	2,900		$	3,800
Costs incurred this period		172,000			201,700			282,380
Total costs	$	175,500		$	204,600		$	286,180
Equivalent units of production		25,360	EUP		25,100	EUP		25,100	EUP
Cost per EUP	$	6.92	Per EUP	$	8.15	Per EUP	$	11.40	Per EUP

Cost assignment and reconciliation
Costs transferred out
Direct materials	$
Direct labor
Factory overhead
		$ 561,235
Costs of ending goods in process
Direct materials	$
Direct labor
Factory overhead
		105,045
Total costs to account for		$ 666,280

Worksheet

Problem 20-3A Part 2