1. The Premier Manufacturing Company uses a job order costing system. The following data

relate to the month of May:

a. Raw materials purchased with cash $80,000.

b. Direct materials issued to production, $79,000.

c. Indirect materials issued to production, $2,500.

d. Direct labor cost incurred, $61,000.

e. Additional actual manufacturing overhead costs totaled incurred $68,000 for the month

(credit Accounts Payable).

f. Overhead is applied on a basis of per machine-hour. Estimated total overhead is

$80,000, and estimated total machine hours is 40,000. In May, 25,000 machine hours

were recorded.

g. Depreciation expense for factory equipment is $2,000 and office furniture is $1,500.

h. Production orders costing $200,000 were completed during the month.

i. During the month, sales invoiced were $94,500. The company uses a 35% mark-up

above cost.

Required:

1. Prepare journal entries to record the information above.

2. Compute the ending balance of work in process. The beginning balance was $15,000.

3. Compute the over applied or under applied manufacturing overhead.