Irvine Company Uses Process Costing

question 8

Essay

Irvine Company uses process costing.The following data are available for the month of June.
(a)Materials purchased,$800,000.
(b)Materials used: Direct materials: Department A $250,000,Department B $230,000.
Indirect materials: $20,000.
(c)Factory payroll incurred,$600,000: Direct labor: Department A $300,000,Department B $200,000.Indirect labor: $100,000.
(d)Other factory overhead incurred,$30,000: Power and light $2,000,Depreciation $20,000,Property tax $5,000,Insurance $3,000.
(e)Factory overhead cost was allocated equally to Department A and Department
B.
(f)Department A completed and transferred to department B $600,000.
(g)Department B completed and transferred to Finished Goods Inventory account $1,000,000.
Required:
(1)Prepare journal entries for June activities in Irvine Company.
(2)Compute ending working-in-process inventories in Department A and Department
B.Please see Feedback for answers.

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Definitions:

Dependent Samples T-test

A statistical test used to compare the means of two related groups to determine if there is a statistically significant difference between them.

Two-way ANOVA

A statistical method used to examine the influence of two different categorical independent variables on one continuous dependent variable.

Degrees of Freedom

The total count of distinct values or elements that may be given to a statistical distribution.

Randomized Block Design

An experimental design that groups subjects into blocks to account for variability among them and then randomly assigns treatments within these blocks.