Image Media, Inc. provides advertising services for clients across the nation. Image Media is presently working on four projects, each for a different client. Image Media accumulates costs for each account (client) on the basis of both direct costs and allocated indirect costs. The direct costs include the charged time of professional personnel and media purchases (air time and ad space). Overhead is allocated to each project as a percentage of media purchases. The predetermined overhead rate is 30% of media purchases.

On June 1, the four advertising projects had the following accumulated costs:

March 1 Balances

Fizz4U Beverage ............$105,000

First Security Bank ............ 175,000

All-Right Rentals ............ 54,000

SleepEzz Hotel ............. 14,000

During June, Image Media, Inc. incurred the following direct labor and media purchase costs related to preparing advertising for each of the four accounts:

At the end of June, both the Fizz4U Beverage and First Security Bank campaigns were completed. The cost of completed campaigns are debited to the cost of services account.
Journalize the summary entry to record each of the following for the month:
a. Direct labor costs
b. Media purchases
c. Overhead applied
d. Completion of Fizz4U Beverage and First Security Bankcampaigns

Transcribed Image Text:

Direct Labor Media Purchases Fizz4U Beverage First Security Bank All-Right Rentals SleepEzz Hotel Total 36,000 15,000 78,000 101,000 $230,000 $160,000 140,000 130,000 80,000 510,000