Sunset Products manufactures skateboards. The following transactions occurred in March:

1. Purchased $20,500 of materials on account.

2. Issued $1,050 of supplies from the materials inventory.

3. Purchased $25,100 of materials on account.

4. Paid for the materials purchased in the transaction (1) using cash.

5. Issued $30,100 in direct materials to the production department.

6. Incurred direct labor costs of $25,500, which were credited to Wages Payable.

7. Paid $21,600 cash for utilities, power, equipment maintenance, and other miscellaneous items for the manufacturing shop.

8. Applied overhead on the basis of 110 percent of direct labor costs.

9. Recognized depreciation on manufacturing property, plant, and equipment of $5,100.

The following balances appeared in the accounts of Sunset

Products for March:

Beginning Ending
Materials Inventory $9,150
Work-in-Process Inventory $16,600
Finished Goods Inventory $65,100 $36,600
cost of goods sold $73,100
Prepare T-Accounts to show the flow of costs during the period from materials inventory through the cost of goods sold.

Sunset products

Journal entry

1. Dr Material 20500

              Cr Account payable 20500

(Material purchased on account)

2. Dr work in process 1050

                       Cr Material   1050

   (material issued)

3. Dr Material 25100

                      Cr Accounts payable 25100

( Material purchased on account )

4. Dr Accounts payable  20500

                                    Cr Cash 20500

  (Paid for material purchased on account)

5. Dr Work in process 30100

                              Cr Material 30100

   ( Direct material issued to production department)

6. Dr Work in process  25500

        Cr  Wages payable           25500

       ( Direct labor cost incurred)

7. Dr Factory overhead 21600

                     Cr Cash            21600

      ( Paid cash for utilities)

8. Dr  Work in process  (25500*110%) 28050

                Cr Applied overhead                                   28050

         (Applied overhead)

9. Dr Factory overhead 5100

              Cr  Accumulated depreciation  5100

      (To record depreciation)

T-account

         Work in process                                           Material          

DrCr                             DR CR

   16600                                                       9150    

  1050                                                         20500 1050

  30100                                                        25100--- 30100

25500---

28050---

   Accounts payable                                                    Cash

DrCr_                                        DR Cr

             ---  20500                                                           20500

             25100                                                           21600

20500

Factory overhead                                                     Wages payable

Dr Cr                                         Dr Cr

   21600---  

                                                                                         25500

5100---

Applied factory overhead                                 Accumulated depreciation

DrCr                                         Dr Cr_

             28050                                                          ---5100

Cost of goods sold                                                     Finished goods

DrCr                                        Dr Cr

                                                                     ( open)   65100 ---  

                                                                               101300       --- 36600 (end)  

Dr Finished goods 101300

        Cr   Work in process     101300

     (move work in process to finished goods)  

Dr Cost of goods sold  129800

                           Finishd goods   129800

      (move finished goods to cost of goods sold)

answer; i believe the correct answer is (sales promotion;

its ii) i did this test

explanation: