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The following transactions occurred in April at Steves Cabinets, a custom cabinet firm. ...

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Accounting

The following transactions occurred in April at Steves Cabinets, a custom cabinet firm.

  1. Purchased $80,000 of materials on account.

  2. Issued $4,000 of supplies from the materials inventory.

  3. Purchased $56,000 of materials on account.

  4. Paid for the materials purchased in transaction (1) using cash.

  5. Issued $68,000 in direct materials to the production department.

  6. Incurred direct labor costs of $100,000, which were credited to Wages Payable.

  7. Paid $106,000 cash for utilities, power, equipment maintenance, and other miscellaneous items for the manufacturing plant.

  8. Applied overhead on the basis of 125 percent of $100,000 direct labor costs.

  9. Recognized depreciation on manufacturing property, plant, and equipment of $50,000.

The following balances appeared in the accounts of Steves Cabinets for April.

Beginning Ending
Materials Inventory $ 148,200 ?
Work-in-Process Inventory 33,000 ?
Finished Goods Inventory 166,000 $ 143,200
Cost of Goods Sold 263,400

Required:

a. Prepare journal entries to record the transactions.

b. Prepare T-accounts to show the flow of costs during the period from Materials Inventory through Cost of Goods Sold.

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