Bayas Corporation Uses Process Costing

question 256

Essay

Bayas Corporation uses process costing. A number of transactions that occurred in June are listed below.(1) Raw materials that cost $39,800 are withdrawn from the storeroom for use in the Mixing Department. All of these raw materials are classified as direct materials.(2) Direct labor costs of $16,100 are incurred, but not yet paid, in the Mixing Department.(3) Manufacturing overhead of $45,700 is applied in the Mixing Department using the department's predetermined overhead rate.(4) Units with a carrying cost of $87,600 finish processing in the Mixing Department and are transferred to the Drying Department for further processing.(5) Units with a carrying cost of $111,300 finish processing in the Drying Department, the final step in the production process, and are transferred to the finished goods warehouse.(6) Finished goods with a carrying cost of $98,200 are sold.Required:Prepare journal entries for each of the transactions listed above.

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Definitions:

Negotiable Instrument

An official note promising the payment of a designated amount of money, either immediately upon asking or at a fixed time, with the individual who is to pay mentioned in the note.

Lack of Delivery

Failure to physically transfer a product, item, or document to its recipient or to fulfill a promise or obligation by the agreed-upon date.

Promissory Note

A written promise to pay a specified sum of money to a designated person at either a fixed or determinable future time.

Contributory Negligence

A legal defense that involves the failure of an injured party to be careful enough to ensure personal safety.