Problem: Real Manufacturing Company provided the following information for the year 2014:
Purchases—direct materials $180,000
Direct materials used in production $192,000
Direct labor $235,000
Indirect materials $23,500
Indirect labor $9,500
Depreciation on factory plant & equipment $12,000
Plant utilities & insurance $135,000
Cost of goods manufactured $591,000
Cost of goods sold $598,500
Please refer to the T-accounts below which show the beginning balances for the year. Record the transactions for the year in each of the three inventory accounts and then show the ending balance in each T-account.
Direct materials Work in process Finished goods
42,000 12,000 49,500