The Kwanika Co

question 66

Short Answer

The Kwanika Co. operates in a lean manufacturing environment. During its first year of operations, Kwanika budgeted for 40,000 hours in the production of 100,000 units in its cell X-22. Material costs were $7 per unit. Cell X-22 conversion costs were budgeted for the year as follows:
During January, material for 8,400 units was purchased on account.  There were 8,200 units manufactured and 8,000 were sold shipped to customers for $35 each. Journalize:
(a) the material purchases
(b) the application of conversion costs
(c) the transfer from work in process to finished goods
(d) the sales (were made on account) and associated cost of goods sold for the month of January.

---

Definitions:

Salaries

Regular payments made to employees for their labor or service, typically expressed as an annual amount but often paid on a monthly or bi-weekly basis.

Adjusting Journal Entry

An accounting record entered at the closing of a financial period to distribute profits and losses to the correct period.

Five-Day Week

A work schedule that typically consists of five eight-hour days, totaling 40 hours, usually from Monday to Friday.

Biweekly Salaries

Salaries that are paid every two weeks, totaling 26 payments over the course of a year.