1. ABC Company had the following balances in their inventory accounts as of 8/31/17 raw materials $10,000, work-in-process $15,000 and finished goods $5,000. During the month of September ABC Company engaged in the following activities.

• Purchased material inventory on account for $40,000

• Transferred $30,000 of material from their warehouse into production

• Paid their production employees $25,000

• Applied manufacturing overhead to production at 120% of direct labor dollars

• Completed job A with a cost of $50,000

• Sold job A to a customer with a 150% markup on account

Question:

• Record the above transactions in T-accounts, please reflect all activity in the accounts and calculate the ending balance in each account.

• What is the profit on the sale of job A?