Shown below are the job cost related accounts for the law firm of Han, Kung, and Ming and their manufacturing-company equivalents:
Law Firm Accounts Manufacturing-Company Accounts
Supplies ................... Raw Materials
Salaries and Wages Payable ....... Factory Wages Payable
Operating Overhead .......... Manufacturing Overhead
Service Contracts in Process ......... Work in Process
Cost of Completed Service Contracts .... Cost of Goods Sold
Cost data for the month of March follow.
1. Purchased supplies on account $1,500.
2. Issued supplies $1,200 (60% direct and 40% indirect).
3. Time cards for the month indicated labor costs of $50,000 (80% direct and 20% indirect).
4. Operating overhead costs incurred for cash totaled $40,000.
5. Operating overhead is applied at a rate of 90% of direct attorney cost.
6. Work completed totaled $70,000.
Instructions
(a) Journalize the transactions for March. Omit explanations.
(b) Determine the balance of the Work in Process account. Use a T account.