Eminence Corporation makes rocking chairs. The chairs move through two departments during production. Lumber is cut into chair parts in the cutting department, which transfers the parts to the assembly department for completion. The company sells the unfinished chairs to hobby shops.

The list of beginning balances are given below:

Cash	$	24,000
Raw materials		8,000
Work in process cutting		9,500
Work in process assembly		11,500
Finished goods		2,000
Production supplies		100
Common stock		47,000
Retained earnings		8,100

The transactions for the second year of operation (2019) are described here. (Assume that all transactions are cash transactions unless otherwise indicated.)

1. The company purchased $10,000 of direct raw materials and $650 of indirect materials. Indirect materials are capitalized in the Production Supplies account.
2. Materials totaling $7,250 were issued to the cutting department.
3. Labor cost was $23,500. Direct labor for the cutting and assembly departments was $11,000 and $10,000, respectively. Indirect labor costs were $2,500. (Note: Assume that sufficient cash is available when periodic payments are made. These amounts represent summary data for the entire year and are not presented in exact order of collection and payment.)
4. The predetermined overhead rate was $0.50 per direct labor dollar in each department.
5. Actual overhead costs other than indirect materials and indirect labor for the month were $7,300.
6. The cutting department transferred $15,500 of inventory to the assembly department.
7. The assembly department transferred $30,500 of inventory to finished goods.
8. The company sold inventory costing $17,500 for $32,000.
9. Selling and administrative expenses were $4,200.
10. At the end of 2019, $150 of production supplies was on hand.
11. Assume that over- or underapplied overhead is insignificant.

Required

1. Record the data in T-accounts.

2. Record the closing entry for over- or underapplied manufacturing overhead, assuming that the amount is insignificant.

3. Close the revenue and expense accounts.

4. Prepare a schedule of cost of goods manufactured and sold, an income statement, and a balance sheet for 2019.

Cash Common Stock Beg. bal. Beg. bal. 1. 47,000 30,000 X 15,000 X 2. 28,200 X 4 6,400 6. 47,000 X 1. 47,000 9. End. bal. 3,000 X 10. 400 End. bal. 24,000 Raw Materials Beg. bal. Beg. bal. Retained Earnings 18,900 X 30,000 X 3,000 X 2. 15,000 X 7,000 X 3. CI End. bal. 8,000 End. bal. 8,100 Manufacturing Overhead Sales Revenue Beg. bal. Beg. bal. 4. 11,500 5. CI 30,000 X 9. 5,200 X 6,400 x 6. 400 x 30,000 11. 300 End. bal. 0 0 End. bal. 0 Work in process Cutting Cost of Goods Sold Beg. bal. Beg. bal. 18,900 X 3. 12,500 X 7. 9. 18,500 X 7,000 X 10,000 X 4. 400 x CI 5. 5,000 X End. bal. 0 0 End. bal. 9,500 Work in process Assembly Selling & Administrative Expenses Beg. bal. Beg. bal. 10. 4. 13,000 20,500 8. 3,000 3,000 CI 5. 6,500 12,500 X 7. End. bal. 0 0 End. bal. 11,500 Finished Goods Beg. bal. 8. X 20,500 X 18,500 X 9. End. bal. 2,000 Production Supplies Beg. bal. 2. 400 X 300 X 11. End. bal. 100 EMINENCE CORPORATION Cost of Goods Manufactured and Sold for 2019 Purchases $ 7,000 X Beginning raw materials inventory Raw materials available 7,000 Ending raw materials inventory Raw materials used 7,000 Labor 23,000 X 11,500 X 41,500 0 X Manufacturing overhead Total manufacturing costs Beginning work in process inventory Total work in process inventory Ending work in process inventory Cost of goods manufactured Beginning finished goods inventory Goods available 41,500 21,000 X 20,500 0 x 20,500 Ending finished goods inventory Cost of goods sold 2,000 X 18,500 $ EMINENCE CORPORATION Income Statement for 2019 $ 32,000 Sales revenue Cost of goods sold Gross margin Operating expenses Selling and administrative expenses 17,400 14,600 4,200 Net income $ 10,400