EXP, Inc. had the following activities during its most recent period of operations:(a) Purchased raw materials on account for $140,000 (both direct and indirect materials are recorded in the Raw Materials Inventory account).(b) Issued raw materials to production of $130,000 (80% direct and 20% indirect).(c) Incurred factory labor costs of $250,000; allocated the factory labor costs to production (70% direct and 30% indirect).(d) Incurred factory utilities costs of $20,000; this amount is still payable.(e) Applied overhead at 80% of direct labor costs.(f) Recorded factory depreciation, $22,000.Prepare journal entries to record the above transactions.
What will be an ideal response?
| (a) | Raw Materials Inventory……………………… | 140,000 | ? |
| ? | Accounts Payable………………………… | ? | 140,000 |
| ? | ? | ? | ? |
| (b) | Work in Process Inventory…………………… | 104,000 | ? |
| ? | Raw Materials Inventory…………………… | ? | 104,000 |
| ? | Factory Overhead……………………………… | 26,000 | ? |
| ? | Raw Materials Inventory…………………… | ? | 26,000 |
| ? | ? | ? | ? |
| (c) | Work in Process Inventory…………………… | 175,000 | ? |
| ? | Factory Wages Payable…………………… | ? | 175,000 |
| ? | Factory Overhead……………………………… | 75,000 | ? |
| ? | Factory Wages Payable…………………… | ? | 75,000 |
| ? | ? | ? | ? |
| (d) | Factory Overhead……………………………… | 20,000 | ? |
| ? | Accounts Payable………………………… | ? | 20,000 |
| ? | ? | ? | ? |
| (e) | Work in Process Inventory…………………… | 140,000 | ? |
| ? | Factory Overhead………………………… | ? | 140,000 |
| ? | ($175,000 ? 80% = $140,000) | ? | ? |
| ? | ? | ? | ? |
| (f) | Factory Overhead……………………………… | 22,000 | ? |
| ? | Accumulated Depreciation-Factory……… | ? | 22,000 |
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