Blue Water Sails, Inc. (BWS) manufactures sailcloth used bysailmakers that produce sails for sailboats. BWS’s sailcloth is theconventional polyester-based sail material and is used widely inrecreational boating. Sailmakers throughout the world use BWS’ssailcloth. The manufacture of sailcloth has a small number ofprocesses, and BWS integrates them carefully so that there is verylittle Work-in-Process Inventory. The product is measured in yardsof cloth, which is prepared in rolls 42 inches wide. Because it haslittle Work-in-Process Inventory, BWS also uses backflushaccounting to simplify the accounting for its operations. BWS hasthe following information for the most recent accounting period.The beginning inventory of polyester fiber was $140,600, and theending inventory was $179,500.
| | | |
| Polyester fiber purchased | $ | 674,500 | |
| Conversion cost incurred | $ | 1,419,500 | |
| Direct materials standard cost | $ | 3.60 | per yard of cloth |
| Conversion standard cost | $ | 8.16 | per yard of cloth |
| Units produced | | 165,900 | yards of cloth |
|
Required:
1. Show the entries for manufacturing costs incurred or applied,completion of 165,900 yards of product, and the closing entries.(If no entry is required for a transaction/event, select"No Journal Entry Required" in the first accountfield.)
a. Record Direct Materials Purchased
b. Record conversion cost incurred
c. Record finished goods for the standard cost of hte165,900 yards produced
d. Record the closing of the two conversion costaccounts
e. Record the closing of the actual usage ofinventory
