The following transactions occured in April at Steve's 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 Steve's Cabinets for April. Beginning $148,200 33,000 166,000 Ending Materiale Inventory Mork-in-Process Inventory Tiniahed Goods Inventory Cost of Cooda Sold $143,200 263,400 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.

The following transactions occured in April at Steve's 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 Steve's Cabinets for April. Beginning $148,200 33,000 166,000 Ending Materiale Inventory Mork-in-Process Inventory Tiniahed Goods Inventory Cost of Cooda Sold $143,200 263,400 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.

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter2: Basic Cost Management Concepts

Section: Chapter Questions

Problem 22E: Ellerson Company provided the following information for the last calendar year: During the year,...

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The following transactions occurred in April at Steve's 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 Steve's Cabinets for April. Materials Inventory Work-in-Process Inventory Finished Goods Inventory Cost of Goods Sold Beginning $ 148,200 33,000 166,000 Ending ? ? $ 143,200 263,400 Required: a.…
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