What is the journal entry to record raw materials used in production? (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Bunnell Corporation is a manufacturer that uses job-order costing. On January 1, the company’s inventory balances were as follows:
| Raw materials | $ 60,500 |
|---|---|
| Work in process | $ 20,800 |
| Finished goods | $ 57,600 |
The company applies overhead cost to jobs on the basis of direct labor-hours. For the current year, the company’s predetermined overhead rate of $11.25 per direct labor-hour was based on a cost formula that estimated $450,000 of total manufacturing overhead for an estimated activity level of 40,000 direct labor-hours. The following transactions were recorded for the year:
- Raw materials were purchased on account, $622,000.
- Raw materials used in production, $591,800. All of of the raw materials were used as direct materials.
- The following costs were accrued for employee services: direct labor, $400,000; indirect labor, $150,000; selling and administrative salaries, $280,000.
- Incurred various selling and administrative expenses (e.g., advertising, sales travel costs, and finished goods warehousing), $400,000.
- Incurred various manufacturing overhead costs (e.g.,
depreciation , insurance, and utilities), $300,000. Manufacturing overhead cost was applied to production. The company actually worked 41,000 direct labor-hours on all jobs during the year.- Jobs costing $1,360,750 to manufacture according to their
job cost sheets were completed during the year. - Jobs were sold on account to customers during the year for a total of $3,330,000. The jobs cost $1,370,750 to manufacture according to their job cost sheets.
Foundational 3-1 (Algo)
Required:
1. What is the
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