A manufacturer of fruit-flavored toaster pastries had a very busy month. After the accountant has looked over all of the production activity, they have determined that the following costs have been incurred:
Direct Materials (DM)
Dough, $8,400
Icing, $9,560
Strawberry, $1,308
Blueberry, $1,503
Raspberry, $1,018
Direct Labor (DL)
Salaries and Wages, $13,407
Manufacturing Overhead (MOH)
MOH Control, $12,706
All of the given costs were incurred within the baking department. Once units are completed, they move on to a finishing department before reaching their final destination at packaging where they packaged for sales. The baking department had a beginning balance of $1,307 and units completed and transferred of $48,469. Which of the following represents a correct portion of a journal entry to account for these costs?

Question

Quizplus · Accepted Answer

This question requires familiarity with the journal entries to record the transfer of costs from Direct Materials inventory into WIP inventory and the incurrence of Conversion Costs (CC). Choice A is correct as it correctly identifies that there needs to be a credit to the DM Inventory- Dough account in order to account for their use of dough.

A Manufacturer of Fruit-Flavored Toaster Pastries Had a Very Busy