Entries for Factory Costs and Jobs Completed Collegiate Publishing Inc. began printing operations on March 1. Jobs 301 and 302 were completed during the month, and all costs applicable to them were recorded on the related cost sheets. Jobs 303 and 304 are still in process at the end of the month, and all applicable costs except factory overhead have been recorded on the related cost sheets. In addition to the materials and labor charged directly to the jobs, $170 of indirect materials and $2,070 of indirect labor were used during the month. The cost sheets for the four jobs entering production during the month are as follows, in summary form: Job 301 Job 302 Direct materials $1,770 Direct materials $830 Direct labor 700 Direct labor 400 Factory overhead 385 Factory overhead 220 Total $2,855 Total $1,450 Job 303 Job 304 Direct materials $2,360 Direct materials $510 Direct labor 800 Direct labor 100 Factory overhead Factory overhead Journalize the summary entry to record each of the following operations for March (one entry for each operation): a. Direct and indirect materials used. If an amount box does not require an entry, leave it blank. imnl -~/ C] Factor Overhead V J Materials ' V ' c. Factory overhead applied to all four jobs (a single overhead rate is used based on direct labor cost). If an amount box does not require an entry, leave it blank. v Ch [:Jv E]C]]x d. Completion of Jobs 301 and 302. If an amount box does not require an entry, leave it blank. v "4 C] -4 Financial Statements of a Manufacturing Firm The following events took place for Rushmore Biking Inc. during February, the first month of operations as a producer of road bikes: . Purchased $478,300 of materials. . Used $411,300 of direct materials in production. . Incurred $352,000 of direct labor wages. . Applied factory overhead at a rate of 75% of direct labor cost. . Transferred $986,200 of work in process to finished goods. . Sold goods with a cost of $947,000. . Revenues earned by selling bikes, $1,695,100. . Incurred $407,200 of selling expenses. . Incurred $151,500 of administrative expenses. a. Prepare the income statement for Rushmore Biking Inc. for the month ending February 28. Assume that Rushmore Biking Inc. uses the perpetual inventory method. Rushmore Biking Inc. Income Statement For the Month Ended February 28 Revenues * V $ 1,695,100 Cost of goods sold > v Gross profit tA Selling and administrative expenses: Selling expenses V Administrative expenses V Total selling and administrative expenses Operating income Vb. Determine the inventory balances on February 28, the end of the first month of operations. Materials inventory, February 28 Work in process inventory, February 28 Finished goods inventory, February 28 LAJob Order Cost Accounting for a Service Company The law firm of Furlan and Benson accumulates costs associated with individual cases, using a job order cost system. The following transactions occurred during July: July 3. Charged 460 hours of professional (lawyer) time to the Obsidian Co. breech of contract suit to prepare for the trial, at a rate of $230 per hour. 10. Reimbursed travel costs to employees for depositions related to the Obsidian case, $24,100. 14. Charged 330 hours of professional time for the Obsidian trial at a rate of $270 per hour. 18. Received invoice from consultants Wadsley and Harden for $53,400 for expert testimony related to the Obsidian trial. 27. Applied office overhead at a rate of $50 per professional hour charged to the Obsidian case. 31. Paid administrative and support salaries of $28,000 for the month. 31. Used office supplies for the month, $9,500. 31. Paid professional salaries of $158,500 for the month. 31. Billed Obsidian $356,400 for successful defense of the case. a. Provide the journal entries for each of these transactions. If an amount box does not require an entry, leave it blank. July 3 Work in Process 10 Salaries Payable July 10 Work in Process V Cash July 14 Work in Process 00 00 00 00 00 Salaries Payable July 18 Work in Process 00 00 00 Consultant Fees Payable July 27 Work in Process Office OverheadJuly 31 Admin. sal. Office Overhead V Cash July 31 Supplies Office Overhead Supplies July 31 Prof. sal. Salaries Payable V 00 00 00 00 00 10 00 00 00 00 Cash July 31 Billed Accounts Receivable Fees Earned * v July 31 Cost Cost of Services Work in Process V Feedback b. How much office overhead is over- or underapplied? Enter your answer as a positive number. tA Overapplied V c. Determine the gross profit on the Obsidian case, assuming that over- or underapplied office overhead is closed monthly to cost of services.Job Order Cost Accounting for a Service Company The Fly Company provides advertising services for clients across the nation. The Fly Company is presently working on four projects, each for a different client. The Fly Company accumulates costs for each account (client) on the basis of both direct costs and allocated indirect costs. The direct costs include the charged time of professional personnel and media purchases (air time and ad space). Overhead is allocated to each project as a percentage of media purchases. The predetermined overhead rate is 45% of media purchases. On August 1, the four advertising projects had the following accumulated costs: August 1 Balances Vault Bank $80,500 Take Off Airlines 24,200 Sleepy Tired Hotels 56,400 Tastee Beverages 34,600 Total $195,700 ) During August, The Fly Company incurred the following direct labor and media purchase costs related to preparing advertising for each of the four accounts: Direct Labor Media Purchases Vault Bank $53,400 $215,100 Take Off Airlines 23,900 189,300 Sleepy Tired Hotels 105,100 138,200 Tastee Beverages 119,500 103,400 Total $301,900 $646,000 At the end of August, both the Vault Bank and Take Off Airlines campaigns were completed. The costs of completed campaigns are debited to the cost of services account. a. Journalize the summary entry to record the direct labor costs for the month. If an amount box does not require an entry, leave it blank. a.'m'V:]:] 'W yauevJC] C] b. Journalize the summary entry to record the media purchases for the month. If an amount box does not require an entry, leave it blank. b. Work in Process Accounts Payable Feedback c. Journalize the summary entry to record the overhead applied for the month. If an amount box does not require an entry, leave it blank. c. Work in Process _ V Agency Overhead Feedback d. Journalize the summary entry to record the completion of Vault Bank and Take Off Airlines for the month. If an amount box does not require an entry, leave it blank. d. Cost of Services Work in Process