Lubricants, Inc., produces a special kind of grease that iswidely used by race car...

90.2K

Verified Solution

Question

Accounting

Lubricants, Inc., produces a special kind of grease that iswidely used by race car drivers. The grease is produced in twoprocessing departments:
      The following incompleteWork in Process account is available for the Refining Departmentfor March:
Work in Process—Refining Department
  March 1 balance 34,000     Completed andtransferred
       to Blending ?
  Materials 141,600
  Direct labor 70,200
  Overhead 486,000
  March 31balance ?
     The March 1 work in processinventory in the Refining Department consists of the followingelements: materials, $8,000; direct labor, $4,700; and overhead,$21,300.
     Costs incurred during March in theBlending Department were: materials used, $46,000; direct labor,$17,600; and overhead cost applied to production, $102,000.
Required:
1.
Prepare journal entries to record the costs incurred in both theRefining Department and Blending Department during March.(If no entry is required for a transaction/event, select"No journal entry required" in the first accountfield.)
a. Raw materials were issued foruse in production.
b. Direct labor costs wereincurred.
c.
Manufacturing overhead costs for the entire factory wereincurred, $636,000. (Credit Accounts Payable.)
d. Manufacturing overhead cost wasapplied to production using a predetermined overhead rate.
e.
Units that were complete with respect to processing in theRefining Department were transferred to the Blending Department,$682,000.
f.
Units that were complete with respect to processing in theBlending Department were transferred to Finished Goods,$720,000.
g. Completed units were sold onaccount, $1,450,000. The Cost of Goods Sold was $660,000.
2.
Post the journal entries from (1) above to T-accounts. Thefollowing account balances existed at the beginning of March. (Thebeginning balance in the Refining Department’s Work in Processaccount is given on the prior page.)
  Raw materials $ 210,600
  Work inprocess—Blending Department $ 53,000
  Finished goods $ 20,000
After posting the entries to the T-accounts, find the endingbalance in the inventory accounts and the manufacturing overheadaccount.

Answer & Explanation Solved by verified expert

3.7 Ratings (315 Votes)

1 Transactions General Journal Debit Credit a Work in processRefining department 141600 Work in processBlending department 46000 Raw Materials 187600 To record direct materials used in production b Work in processRefining department 70200 Work in processBlending department 17600 Salaries and Wages payable 87800 To record direct labor costs See Answer

Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:

Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!

Become a Member

Transcribed Image Text

In: AccountingLubricants, Inc., produces a special kind of grease that iswidely used by race car drivers....Lubricants, Inc., produces a special kind of grease that iswidely used by race car drivers. The grease is produced in twoprocessing departments: The following incompleteWork in Process account is available for the Refining Departmentfor March:Work in Process—Refining Department March 1 balance34,000 Completed andtransferred to Blending? Materials141,600 Direct labor70,200 Overhead486,000 March 31balance? The March 1 work in processinventory in the Refining Department consists of the followingelements: materials, $8,000; direct labor, $4,700; and overhead,$21,300. Costs incurred during March in theBlending Department were: materials used, $46,000; direct labor,$17,600; and overhead cost applied to production, $102,000.Required:1.Prepare journal entries to record the costs incurred in both theRefining Department and Blending Department during March.(If no entry is required for a transaction/event, select"No journal entry required" in the first accountfield.)a.Raw materials were issued foruse in production.b.Direct labor costs wereincurred.c.Manufacturing overhead costs for the entire factory wereincurred, $636,000. (Credit Accounts Payable.)d.Manufacturing overhead cost wasapplied to production using a predetermined overhead rate.e.Units that were complete with respect to processing in theRefining Department were transferred to the Blending Department,$682,000.f.Units that were complete with respect to processing in theBlending Department were transferred to Finished Goods,$720,000.g.Completed units were sold onaccount, $1,450,000. The Cost of Goods Sold was $660,000.2.Post the journal entries from (1) above to T-accounts. Thefollowing account balances existed at the beginning of March. (Thebeginning balance in the Refining Department’s Work in Processaccount is given on the prior page.) Raw materials$210,600 Work inprocess—Blending Department$53,000 Finished goods$20,000After posting the entries to the T-accounts, find the endingbalance in the inventory accounts and the manufacturing overheadaccount.


March 1 balance	34,000	Completed andtransferred to Blending	?
Materials	141,600
Direct labor	70,200
Overhead	486,000

March 31balance	?

a.	Raw materials were issued foruse in production.
b.	Direct labor costs wereincurred.
c.	Manufacturing overhead costs for the entire factory wereincurred, $636,000. (Credit Accounts Payable.)
d.	Manufacturing overhead cost wasapplied to production using a predetermined overhead rate.
e.	Units that were complete with respect to processing in theRefining Department were transferred to the Blending Department,$682,000.
f.	Units that were complete with respect to processing in theBlending Department were transferred to Finished Goods,$720,000.
g.	Completed units were sold onaccount, $1,450,000. The Cost of Goods Sold was $660,000.


Raw materials	$	210,600
Work inprocess—Blending Department	$	53,000
Finished goods	$	20,000