TB MC Qu. 3-209 Chavez Corporation reported the ... Chavez Corporation reported the following data for the month of July: Inventories: Beginning Ending Raw materials $ 41,000 $ 37,000 Work in process $ 23,000 $ 31,000 Finished goods $ 39,000 $ 54,000 Additional information: Raw materials purchases $ 73,000 Direct labor cost $ 98,000 Manufacturing overhead cost incurred $ 66,000 Indirect materials included in manufacturing overhead cost incurred $ 10,800 Manufacturing overhead cost applied to Work in Process $ 65,000 Any underapplied or overapplied manufacturing overhead is closed out to cost of goods sold. The cost of goods manufactured for July is:

The cost of goods manufactured for July is $ 232,000

Explanation:

Raw Materials Inventories Utilized In Production

Beginning Raw materials        $ 41,000

Add Purchases                        $ 73,000

Less Ending  Raw materials   ($ 37,000)

Used in Production                  $ 77,000

Cost of goods manufactured

Raw Materials                              $ 77,000

Direct labor cost                          $ 98,000

Manufacturing overhead            $ 65,000

Total Cost of Manufacturing     $ 240,000

Add Opening Work in process  $ 23,000

Less Ending Work in process    ($ 31,000)

Cost of goods manufactured   $ 232,000

Not that Manufacturing overhead are included to the amount Applied in the Manufacturing Cost

See the explanation for the answer.

Explanation:

(a)

Bonds are issued at face value

date                   Account                          debit                 credit

Jan 1 ,2019       cash                               $379,500  

                        bonds payable                                        $379,500

                        [to record cash received

                        against bonds issued]  

b.

Interest accrued from Jan-Dec = $379,500*7% = $26,565

                                    Account  

Dec 31 ,2019          Interest expense              $26,565  

                              Interest payable on bonds                 $26,565

As interest is accrued it will be expensed

.

However, it is not paid so it will be interest payable

c)  Interest paid

                                                                       Debit               Credit

Jan 1 ,2020  Interest payable on bonds    $26,565  

                       Cash                                                            $26,565