Deporte Company produces single-colored t-shirts. Materials for the shirts are dyed in large vats. After dying the materials for a given color, the vats must be cleaned and prepared for the next batch of materials to be colored. The following standards for changeover for a given batch have been established: 1 Direct materials (2.6 lbs. @ $0.95) $2.47 2 Direct labor (0.60 hr. @ $7.2) 4.32 3 Standard prime cost $6.79 During the year, 76,950 pounds of material were purchased and used for the changeover activity. There were 27,000 batches produced, with the following actual prime costs: Direct materials $60,979 Direct labor (for 16,155 hrs.) $114,341 Required: 1. Prepare a journal entry on Dec. 31 for the purchase of raw materials. Record the transaction as a compound entry. 2. Prepare a journal entry on Dec. 31 for the issuance of raw materials. Record the transaction as a compound entry. 3. Prepare a journal entry on Dec. 31 for the addition of labor to Work in Process. Record the transaction as a compound entry. 4. Prepare a journal entry on Dec. 31 for the closing of variances to Cost of Goods Sold. Record the transaction as a compound entry. CHART OF ACCOUNTS Deporte Company General Ledger ASSETS 110 Cash 120 Accounts Receivable 131 Supplies 132 Prepaid Insurance 141 Materials 142 Work in Process 143 Overhead Control 144 Finished Goods 170 Land 180 Equipment 181 Accumulated Depreciation LIABILITIES 210 Accounts Payable 220 Accrued Payroll 230 Utilities Payable 240 Lease Payable EQUITY 310 Common Stock 320 Retained Earnings Prepare the Dec. 31 journal entries for the (1) purchase of raw materials, (2) issuance of raw materials, (3) addition of labor to Work in Process, and the (4) closing of variances to Cost of Goods Sold. Refer to the Chart of Accounts for the exact wording of account titles. Record each transaction as a compound entry. PAGE 10 GENERAL JOURNAL DATE ACCOUNT POST. REF. DEBIT CREDIT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

Deporte Company produces single-colored t-shirts. Materials for the shirts are dyed in large vats. After dying the materials for a given color, the vats must be cleaned and prepared for the next batch of materials to be colored. The following standards for changeover for a given batch have been established: 1 Direct materials (2.6 lbs. @ $0.95) $2.47 2 Direct labor (0.60 hr. @ $7.2) 4.32 3 Standard prime cost $6.79 During the year, 76,950 pounds of material were purchased and used for the changeover activity. There were 27,000 batches produced, with the following actual prime costs: Direct materials $60,979 Direct labor (for 16,155 hrs.) $114,341 Required: 1. Prepare a journal entry on Dec. 31 for the purchase of raw materials. Record the transaction as a compound entry. 2. Prepare a journal entry on Dec. 31 for the issuance of raw materials. Record the transaction as a compound entry. 3. Prepare a journal entry on Dec. 31 for the addition of labor to Work in Process. Record the transaction as a compound entry. 4. Prepare a journal entry on Dec. 31 for the closing of variances to Cost of Goods Sold. Record the transaction as a compound entry. CHART OF ACCOUNTS Deporte Company General Ledger ASSETS 110 Cash 120 Accounts Receivable 131 Supplies 132 Prepaid Insurance 141 Materials 142 Work in Process 143 Overhead Control 144 Finished Goods 170 Land 180 Equipment 181 Accumulated Depreciation LIABILITIES 210 Accounts Payable 220 Accrued Payroll 230 Utilities Payable 240 Lease Payable EQUITY 310 Common Stock 320 Retained Earnings Prepare the Dec. 31 journal entries for the (1) purchase of raw materials, (2) issuance of raw materials, (3) addition of labor to Work in Process, and the (4) closing of variances to Cost of Goods Sold. Refer to the Chart of Accounts for the exact wording of account titles. Record each transaction as a compound entry. PAGE 10 GENERAL JOURNAL DATE ACCOUNT POST. REF. DEBIT CREDIT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter9: Standard Costing: A Functional-based Control Approach

Section: Chapter Questions

Problem 28P: Haversham Corporation produces dress shirts. The company uses a standard costing system and has set...

See similar textbooks

Related questions

Question

1	Direct materials (2.6 lbs. @ $0.95)	$2.47
2	Direct labor (0.60 hr. @ $7.2)	4.32
3	Standard prime cost	$6.79

During the year, 76,950 pounds of material were purchased and used for the changeover activity. There were 27,000 batches produced, with the following actual prime costs:

Direct materials	$60,979
Direct labor (for 16,155 hrs.)	$114,341

	Required:
1.	Prepare a journal entry on Dec. 31 for the purchase of raw materials. Record the transaction as a compound entry.
2.	Prepare a journal entry on Dec. 31 for the issuance of raw materials. Record the transaction as a compound entry.
3.	Prepare a journal entry on Dec. 31 for the addition of labor to Work in Process. Record the transaction as a compound entry.
4.	Prepare a journal entry on Dec. 31 for the closing of variances to Cost of Goods Sold. Record the transaction as a compound entry.

CHART OF ACCOUNTS

Deporte Company

General Ledger

	ASSETS
110	Cash
120	Accounts Receivable
131	Supplies
132	Prepaid Insurance
141	Materials
142	Work in Process
143	Overhead Control
144	Finished Goods
170	Land
180	Equipment
181	Accumulated Depreciation

	LIABILITIES
210	Accounts Payable
220	Accrued Payroll
230	Utilities Payable
240	Lease Payable

	EQUITY
310	Common Stock
320	Retained Earnings

Prepare the Dec. 31 journal entries for the (1) purchase of raw materials, (2) issuance of raw materials, (3) addition of labor to Work in Process, and the (4) closing of variances to Cost of Goods Sold. Refer to the Chart of Accounts for the exact wording of account titles. Record each transaction as a compound entry.

PAGE 10

GENERAL JOURNAL

	DATE	ACCOUNT	POST. REF.	DEBIT	CREDIT
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15

Expert Solution

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.