Design Flooring Carpet Company_Process Costing_Entries and Acccounts

Design Flooring Carpet
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 carpet backing is added at the
beginning of the process and the process is completed

On July 1, Design Flooring
Carpet Company had the following inventories:

Finished
Goods…………………………………….$5,600

Work in Process – Spinning
Department …..900

Work in Process – Tufting
Department ……1,400 Materials…………………………………………………..4,200

Departmental accounts are
maintained for factory overhead, and both have zero balances on July 1.
Manufacturing operations for July are summarized as follows:

a. Materials purchased on
account $ 84,600

b. Materials requisitioned
for use: Fiber”Spinning Department $ 42,800 Carpet backing”Tufting
Department 34,400 Indirect materials”Spinning Department 3,200 Indirect
materials”Tufting Department 2,800

c. Labor used: Direct
labor”Spinning Department $ 24,200 Direct labor”Tufting Department
18,700 Indirect labor”Spinning Department 12,300 Indirect
labor”Tufting Department 11,900

d. Depreciation charged on
fixed assets: Spinning Department $ 5,300 Tufting Department 3,100

e. Expired prepaid factory
insurance: Spinning Department $ 1,200 Tufting Department 900

f. Applied factory
overhead: Spinning Department $ 21,600 Tufting Department 19,500

g. Production costs
transferred from Spinning Department to Tufting Department $ 87,200

h. Production costs
transferred from Tufting Department to Finished Goods $159,200

i. Cost of goods sold
during the period $160,300

Instructions:

Journalize the entries to
record the operations, identifying each entry by letter. Compute the July 31
balances of the inventory accounts. Compute the July 31 balances of the factory
overhead accounts.