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Entries for process cost system Pori Ormond Carpel Company manufactures carpets. Fiber is placed in process in the Spinning Department, where it is spun into yarn. The output of the Spinning Department is transferred to the Tufting Department, where carpel hacking is added al the beginning of the process and the process is completed. On January 1, Port Ormond Carpet Company had the following inventories: Finished Goods $62,000 Work in Process—Spinning Department 35,000 Work in Process—Tufting Department 28,500 Materials 17,000 Departmental accounts are maintained for factory overhead, and both have zero balances on January 1. Manufacturing operations for January are summarized as follows: a Materials purchased on account $500,000 b Materials requisitioned for use Fiber—Spinning Department $275,000 Carpet backing—Tufting Department 110,000 Indirect materials—Spinning Department 46,000 Indirect materials—Tufting Department 39,500 c. Labor used Direct labor—Spinning Department $185,000 Direct labor—Tufting Department 98,000 Indirect labor—Spanning Department 18,500 Indirect labor—Tufting Department 9,000 d Depreciation charged on fixed assets: Spinning Department $12,500 Tufting Department 8,500 e. Expired prepaid factory insurance: Spinning Department $2,000 Tufting Department 1,000 f. Applied factory overhead Spinning Department $80,000 Tufting Department 55,000 g Production costs transferred from Spinning Department to Tufting Department $547,000 h Production costs transferred from Tufting Department to Finished Goods $807,200 i. Cost of goods sold during the period $795,200 Instructions 1. Journalize the entries to record the operations, identifying each entry by letter. 2. Compute the January 31 balances of the inventory accounts. 3. Compute the January 31 balances of the factory overhead accounts.

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Accounting

27th Edition
WARREN + 5 others
Publisher: Cengage Learning,
ISBN: 9781337272094
BuyFind

Accounting

27th Edition
WARREN + 5 others
Publisher: Cengage Learning,
ISBN: 9781337272094

Solutions

Chapter
Section
Chapter 20, Problem 20.1APR
Textbook Problem

Entries for process cost system

Pori Ormond Carpel Company manufactures carpets. Fiber is placed in process in the Spinning Department, where it is spun into yarn. The output of the Spinning Department is transferred to the Tufting Department, where carpel hacking is added al the beginning of the process and the process is completed. On January 1, Port Ormond Carpet Company had the following inventories:

Finished Goods $62,000
Work in Process—Spinning Department 35,000
Work in Process—Tufting Department 28,500
Materials 17,000

Departmental accounts are maintained for factory overhead, and both have zero balances on January 1.

Manufacturing operations for January are summarized as follows:

a Materials purchased on account $500,000
b Materials requisitioned for use  
Fiber—Spinning Department $275,000
Carpet backing—Tufting Department 110,000
Indirect materials—Spinning Department 46,000
Indirect materials—Tufting Department 39,500
c. Labor used  
Direct labor—Spinning Department $185,000
Direct labor—Tufting Department 98,000
Indirect labor—Spanning Department 18,500
Indirect labor—Tufting Department 9,000
d Depreciation charged on fixed assets:  
Spinning Department $12,500
Tufting Department 8,500
e. Expired prepaid factory insurance:  
Spinning Department $2,000
Tufting Department 1,000
f. Applied factory overhead  
Spinning Department $80,000
Tufting Department 55,000
g Production costs transferred from Spinning Department to Tufting Department $547,000
h Production costs transferred from Tufting Department to Finished Goods $807,200
i. Cost of goods sold during the period $795,200

Instructions

1. Journalize the entries to record the operations, identifying each entry by letter.

2. Compute the January 31 balances of the inventory accounts.

3. Compute the January 31 balances of the factory overhead accounts.

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