1. A firm produces its products by a continuous process involving three production departments, 1 through 3. Prepare entries to record the following selected transactions related to production during August:

   a. Materials purchased on account, $120,000.

   	Materials
   	Accounts Payable

   b. Material requisitioned for use in Department 1, $125,700, of which $124,200 entered directly into the product. If an amount box does not require an entry, leave it blank.

   	Factory Overhead-Department 1
   	Work in Process-Department 1
   	Materials

   c. Labor cost incurred in Department 1, $195,400, of which $174,000 was used directly in the manufacture of the product. If an amount box does not require an entry, leave it blank.

   	Factory Overhead-Department 1
   	Work in Process-Department 1
   	Wages Payable

   d. Factory overhead costs for Department 1 incurred on account, $54,700.

   	Factory Overhead-Department 1
   	Accounts Payable

   e. Depreciation on machinery in Department 1, $29,200.

   	Factory Overhead-Department 1
   	Accumulated Depreciation-Machinery

   f. Expiration of prepaid insurance chargeable to Department 1, $7,000.

   	Factory Overhead-Department 1
   	Prepaid Insurance

   g. Factory overhead applied to production in Department 1, $106,300.

   	Work in Process-Department 1
   	Factory Overhead-Department 1

   h. Output of Department 1 transferred to Department 2, $362,700.

   	Work in Process-Department 2
   	Work in Process-Department 1

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