Monday, 22 February 2016

The following information is available for Lock-Safe Company, which produces special-order security products and uses a job order cost accounting system.

The following information is available for Lock-Safe Company, which produces special-order security products and uses a job order cost accounting system.

  April 30 May 31  
  Inventories          
     Raw materials $ 45,000   $ 52,000  
     Goods in process   9,700     17,000  
     Finished goods   64,000     33,000  
  Activities and information for May          
     Raw materials purchases (paid with cash)       195,000  
     Factory payroll (paid with cash)       395,000  
     Factory overhead          
        Indirect materials       13,000  
        Indirect labor       74,000  
        Other overhead costs       98,000  
     Sales (received in cash)       1,200,000  
     Predetermined overhead rate based on direct labor cost       50 %

 
1. Factory overhead excluding indirect materials and indirect labor (record credit to Other Accounts).
2. Application of overhead to goods in process.
  
Prepare journal entries for the above events for the month of May.
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Explanation: