During August, the company incurred the following factory costs:
1. Purchased $390,000 of raw material on account.
2. Issued $260,000 of raw material to production, of which $154,000 was for direct materials.
3. Accrued $160,000 in factory payroll costs; $92,000 was for direct labor and the rest was
for supervisors’ salaries.
4. Accrued $19,000 of utility costs; of this amount, $5,600 was fixed.
5. Accrued $4,000 of property taxes on the factory.
6. Recorded the expiration of $6,600 of prepaid insurance on factory equipment.
7. Recorded $46,000 of straight-line depreciation on factory equipment.
8. Applied actual overhead to Work in Process Inventory.
9. Transferred goods costing $390,000 to Finished Goods Inventory.
10. Recorded total sales of $830,000; of these, $570,000 were on account.
11. Recorded cost of goods sold of $470,000.
12. Recorded selling and administrative costs of $240,000 (credit “Various accounts”).
Required:
a. Journalize the transactions for August.
b. Post transactions to T-accounts for Raw Material Inventory, Work in Process Inventory,
Finished Goods Inventory, and Cost of Goods Sold.
c. Prepare a schedule of cost of goods manufactured and cost of goods sold for August.
