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21 February, 14:54

Sheffield Company purchases $50,300 of raw materials on account, and it incurs $63,900 of factory labor costs. Supporting records show that (a) the Assembly Department used $27,100 of the raw materials and $40,100 of the factory labor, and (b) the Finishing Department used the remainder. Manufacturing overhead is assigned to departments on the basis of 160% of labor costs. Journalize the assignment of overhead to the Assembly and Finishing Departments.

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  1. 21 February, 17:00
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    Work-in-process - Assembly Department $64,160 (debit)

    Work-in-process - Finishing Department $38,080 (debit)

    Overhead $102,240 (credit)

    Explanation:

    Assembly Department Costs Assignments

    J1 : Raw Materials

    Work - in-process $27,100 (debit)

    Raw Materials (credit)

    J2 : Labor

    Work - in-process $40,100 (debit)

    Salaries and Wages Payable $40,100 (credit)

    J3 : Overheads

    Work-in-process $64,160 (debit)

    Overhead $64,160 (credit)

    Finishing Department Costs Assignments

    J1 : Raw Materials

    Work - in-process $23,200 (debit)

    Raw Materials $23,200 (credit)

    J2 : Labor

    Work - in-process $23,800 (debit)

    Salaries and Wages Payable $23,800 (credit)

    J3 : Overheads

    Work-in-process $38,080 (debit)

    Overhead $38,080 (credit)

    Summary of assignment of overhead

    Work-in-process - Assembly Department $64,160 (debit)

    Work-in-process - Finishing Department $38,080 (debit)

    Overhead $102,240 (credit)
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