Question:
Journalizing materials transactions
Milano's Specialty Clothing, Inc., uses a job order cost system. A partial list of the accounts being maintained by the company, with their balances as of November 1, follows:
|
Cash
|
$82,250
|
|
Materials
|
29,500
|
|
Work in process
|
$27,000
|
|
Accounts payable (credit)
|
21,000
|
|
Factory overhead
|
none
|
The following transactions were completed during the month of November:
a. Materials purchases on account during the month, $74,000.
b. Materials requisitioned during the month:
1. Direct materials, $57,000.
2. Indirect materials, $11,000.
c. Direct materials returned by factory to storeroom during the month, $1,100.
d. Materials returned to vendors during the month prior to payment, $2,500.
e. Payments to vendors during the month, $68,500.
Required:
1. Prepare general journal entries for each of the transactions.
2. Post the general journal entries to T-accounts.
3. Balance the accounts and report the balances of November 30 for the following:
a. Cash
b. Materials
c. Accounts Payable