Job costs in a service organization. Web Support Unlimited, a Web site design and maintenance firm, uses job costing. During November, the firm provided Web site services for two clients and billed those clients lor the services performed. Sierra Vista Company was billed for $150,000 and Placerville Productions was billed for

$100,000. Direct labor costs were $80 per hour. Web Support Unlimited worked 1,200 hours on the Sierra Vista account and 900 hours on the Placerville account.

The firm worked an additional 100 hours that it did not charge to either account. The firm assigns overhead to jobs at the rate of $30 per billable hour. During November, the firm incurred actual overhead of $70,000. The firm incurred marketing and administrative costs of $30,000. All transactions were on account.

a. Show how Web Support Unlimited's accounting system would record these revenues and costs using journal entries.

b. Prepare an income statement for November like the one in Exhibit 2.5.