Lutz Manufacturing Company Research

Lutz Manufacturing Company produces a product in two departments: (1) Mixing and (2) Finishing. The company uses a process cost accounting system.


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(a)  Purchased raw materials for $50,000 on account.




(b)  Raw materials requisitioned for production were:


Direct materials


Mixing department  $20,000


Finishing department  14,000




(c)  Incurred labor costs of $69,000.




(d)  Factory labor used:


Mixing department  $44,000


Finishing department  25,000




(e)  Manufacturing overhead is applied to the product based on machine hours used in each department:


Mixing department—300 machine hours at $30 per machine hour.


Finishing department—500 machine hours at $20 per machine hour.




(f)  Units costing $56,000 were completed in the Mixing Department and were transferred to the Finishing Department.




(g)  Units costing $60,000 were completed in the Finishing Department and were transferred to finished goods.




(h)  Finished goods costing $40,000 were sold on account for $55,000.



Prepare the journal entries to record the preceding transactions for Lutz Manufacturing Company.

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