Cost Accounting Cycle Entries. During September these transactions took place at the Grand Rapids

Cost Accounting Cycle Entries. During September these transactions took place at the Grand Rapids Manufacturing Company : Sept. 1. Purchased raw materials from Harvey Manufacturing Company, $5,500. Terms: 2/10, n/60. Purchases are recorded at the gross amount.

1. Received a $2,500 invoice for factory equipment from Becker & Company. Terms: net 90 days.

3. Sent C. E. Olsen, a company salesman, a $205 check for traveling expenses.

5. Paid and distributed weekly payroll:

Federal

Gross

Income Tax

PICA

Earnings

Withheld

Tax

Factory (20% of the factory payroll is indirect

labor)

$3,200

$320

$192

Marketing

1,400

140

84

Office

1,200

120

72

5. Employer's payroll taxes on weekly payroll : FICA tax, 6% ; state unemployment tax, 2.7%; federal unemployment, .5%. Charge factory payroll taxes to factory overhead.

8. Paid Lackawanna Railroad Company $105 for freight on a machine bought on September 1.

9. Paid Becker & Company $340 for installing machinery bought on September 1.

10. Paid Harvey Manufacturing Company for September 1 invoice.

1 1

Received advertising bill from the Ayres Advertising Agency, $300. Terms : net 30 days.

12. Paid and distributed weekly payroll:

Federal

Gross Income

Income Tax

Earnings

Withheld

FICA

Factory (25% of the factory payroll is

Tax

indirect labor)

$3,280

$328

$196.80

Marketing

1,350

135

81.00

Office

1,200

120

72.00

12. Employer's payroll taxes on weekly payroll (see Sept. 5 transaction for instructions).

14. Purchased factory supplies from Haines & Company, $1,560. Terms: 2/10, n/30. Charge factory overhead.

Sept. 16. Bought tools for factory use from Tower Machinery Company for cash, $60. Charge factory overhead.

17. Paid Brown Garage Company for service and repair of trucks, $800. Of this amount, charge 60% to the factory and the balance to marketing.

18. Paid the bill of the Ayres Advertising Agency.

18. Bought raw materials from Clark Manufacturing Company, $7,500. Terms: net 30 days.

1 9. Paid and distributed weekly payroll

Federal

Gross

Income Tax

FICA

Earnings

Withheld

Tax

Factory (20% of the factory payroll is indirect labor)

$3,250

$325

$195.00

Marketing

1,320

132

79.2

Office

1,190

119

71.4

19. Employer's payroll taxes on weekly payroll.

21. Returned to Clark Manufacturing Company the raw materials received in damaged condition on the 18th; billed price, $600.

22. Purchased raw materials from Boyer Manufacturing Company for cash, $3,000.

23. Paid Haines & Company for September 14 invoice.

24. Paid Apex Service Company for repairs to factory building, $575. Charge factory overhead.

25. Paid Reading Railroad Company for freight as follows: freight-in, $145; freight-out, $120.

25. Paid Franklin Insurance Agency $960 for a 3-year fire insurance premium.

26. Paid and distributed weekly payroll

Federal

Gross

Income Tax

FICA

Earnings

Withheld

Tax

Factory (20% of the factory payroll is indirect labor)

$3,300

$330

$198.00

Marketing

1,330

133

79.8

Office

1,200

120

72

26. Employer's payroll taxes on weekly payroll.

26. Paid Clark Manufacturing Company for Sept. 18 invoice less damaged materials returned.

30. Paid Central Telephone Company bill, $210 (charge 10%, to factory, 60% to marketing, and 30% to office).

30. The beginning raw materials inventory was $2,000; the ending inventory is $2,200. Transfer the difference to Work in Process after posting the purchase transactions.

30. Factory overhead for September to be applied based on a rate of 70% of direct labor cost.

30. The following information relates to expiration of insurance and accrual of depreciation for September:

Depreciation on factory equipment

$420

Depreciation on delivery equipment

330

Depreciation on office equipment

210

Insurance expired on factory

350

Insurance expired on delivery equipment

430

Insurance expired on office equipment

1 80

Sept. 30.

Other necessary end-of-month information is as follows:

Costs transferred from Work in Process to Finished Goods.

31,927

Opening inventory, Work in Process

3,500

Cost of goods sold

32,085

Opening inventory. Finished Goods

3,875

Sales on account

61,320

30. Determine the amount of over- or underapplied factory overhead, and transfer the balance to Cost of Goods Sold.

Required: Record the preceding transactions in general journal entry form.