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During January, the company had two jobs in process. Job A was an order for 1,200 stamped parts and was started in December. Job A

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During January, the company had two jobs in process. Job A was an order for 1,200 stamped parts and was started in December. Job A had $12,000 of manufacturing costs already accumulated on January 1. Job B was an order for 1,000 stamped parts and was started in January. The company used a job-order costing system. Total manufacturing overhead for the year was estimated to be $576,000. Mountain Manufacturing uses direct labour-hours as the allocation base to establish its predetermined overhead rate. A total of 19,200 direct labour-hours are expected to be worked during the year. On January 1, the start of the company's fiscal year, inventory account balances were as follows: Raw Materials $ 15,000 Work in Process $ 12,000 Finished Goods $ 10,000 During the month of January, the following transactions were completed: Raw materials were purchased for $30,000. Raw materials were requisitioned for use in production in the amount of $35,000. Of this amount, $25,000 was related to manufacturing (85,000 for Job A and $20,000 for Job B) and the rest were indirect materials. In January, $32,000 of direct labour ($7,000 for Job A and $25,000 for Job B). In addition, $2,000 of indirect labour costs were incurred. In January, the company incurred the following general factory costs: Utilities expense of $8,000, rent on factory equipment of $8,000, and insurance costs of $1,900. The company recognized $10,000 in depreciation on factory equipment. The company applied manufacturing overhead to Job A and Job B. A total of 350 direct labour-hours were spent completing Job A and 1,250 direct labour-hours were recorded for Job B. Administrative salaries of $30,000 were paid in January. Selling expenses totalled $6,000 in January. Job A was completed in January. The completed cost of Job A according to the job cost sheet was $34,500. Job B remains in process at the end of January. Sales of all 1,200 units in Job A were recorded on account in the amount of $48,300 in January. Required: 1. Prepare journal entries to record the transactions for January. (If no entry is required for a transaction/event, select "No journal entry required\" in the first account field.) 20 marks 2. Prepare T-accounts. Determine ending balances in the inventory accounts and in the Manufacturing Overhead account. 20 marks 3. Prepare a schedule of cost of goods manufactured. 10 marks 4a. Prepare a journal entry to properly dispose of any balance in the Manufacturing Overhead account. (If no entry is required for a transaction/event, select "No journal entry required\" in the first account field.) 5 marks 4b. Determine the adjusted Cost of Goods Sold. 5 marks 5. Prepare an income statement for the month of January. 10marks

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