=+2. Determine the July 31 balances for each of the inventory accounts and factory overhead.

Digital Tunes Inc. is in the business of developing, promoting, and selling musical talent on compact disc (CD). The company signed a new group, called Smashing Britney, on January 1, 2010. For the first six months of 2010, the company spent $4,000,000 on a media campaign for Smashing Britney and $1,200,000 in legal costs. The CD production began on February 1, 2010.

Digital Tunes uses a job order cost system to accumulate costs associated with a CD title. The unit direct materials cost for the CD is:

Blank CD $1.80 Jewel case 0.60 Song lyric insert 0.60