Overview of general-ledger relationships. The Blakely Company is a small machine shop that uses highly skilled labour and a job-costing system (using normal costing). The total deb¬

its and credits in certain accounts just before year-end are as follows:

December 30, 2007 Total Debits Total Credits Materials Control $120,000 $ 84,000 Work-in-Process Control 384,000 366,000 Manufacturing Department Overhead Control 102,000 —

Finished Goods Control 390,000 360,000 Cost of Goods $old 360,000 —

Manufacturing Overhead Allocated — 108,000 All materials purchased are for direct materials. Note that “total debits” in the inven¬

tory accounts would include beginning inventory balances, if any. JOB COSTING 145 The preceding accounts do not include the following:

a. The manufacturing labour costs recapitulation for the December 31 working day:

direct manufacturing labour, $6,000, and indirect manufacturing labour, $1,200.

b. Miscellaneous manufacturing overhead incurred on December 30 and December 31:

$1,200.

Additional Information Manufacturing overhead has been allocated as a percentage of direct manufacturing labour costs through December 30.

Direct materials purchased during 2007 were $102,000.

There were no returns to suppliers.

Direct manufacturing labour costs during 2007 totalled $180,000, not including the December 31 working day described previously.

Required 1. Compute the inventories (December 31, 2007) of materials control, work-in-process control, and finished goods control. $how T-accounts.

2. Prepare all adjusting and closing journal entries for the preceding accounts. Assume that all under- or overallocated manufacturing overhead is closed directly to Cost of Goods hold.