Paige Ltd had the following transactions during its first month of operations:
1. Purchased raw materials on account, $85,000.
2. Raw materials of $30,000 were requisitioned to the factory. An analysis of the materials requisition slips indicated that $6,000 was classified as indirect materials.
3. Factory labour costs incurred were $95,000 of which $84,000 pertained to factory wages payable and $11,000 pertained to employer payroll taxes payable.
4. Time tickets indicated that $80,000 was direct labour and $15,000 was indirect labour.
5. Overhead costs incurred on account were $96,000.
6. Manufacturing overhead was applied at the rate of 150% of direct labour cost.
7. Goods costing $115,000 are still incomplete at the end of the month; the other goods were completed and transferred to finished goods.
8. Finished goods costing $90,000 to manufacture were sold on account for $120,000.
Instructions: Journalise the above transactions for Paige Ltd.

Question

Quizplus · Accepted Answer

The Answer of Paige Ltd had the following transactions during its first month of operations:
1. Purchased raw materials on account, $85,000.
2. Raw materials of $30,000 were requisitioned to the factory. An analysis of the materials requisition slips indicated that $6,000 was classified as indirect materials.
3. Factory labour costs incurred were $95,000 of which $84,000 pertained to factory wages payable and $11,000 pertained to employer payroll taxes payable.
4. Time tickets indicated that $80,000 was direct labour and $15,000 was indirect labour.
5. Overhead costs incurred on account were $96,000.
6. Manufacturing overhead was applied at the rate of 150% of direct labour cost.
7. Goods costing $115,000 are still incomplete at the end of the month; the other goods were completed and transferred to finished goods.
8. Finished goods costing $90,000 to manufacture were sold on account for $120,000.
Instructions: Journalise the above transactions for Paige Ltd.

Paige Ltd Had the Following Transactions During Its First Month