Exercise 5 -- Journal entries for monthly transactions:

Shapiro, Inc. uses job costing and applies factory overheads on the basis of direct labor hours.

Transactions of July were:

1. Materials purchased on account, $10,000
2. Shop supplies purchase on account, $5,000
3. Materials requisitioned, $10000, of which $7000 was direct materials.
4. Recorded liability, paid and distributed payroll: direct labor, $15,000; indirect labor, $5,000; employee income tax withheld, $2,000; FICA tax, $1,200
5. Employee factory payroll taxes for the month, $1,800.
6. Factory overhead paid: repairs,$175; rent, $300; power and light ,$400
7. Depreciation of machinery and equipment, $625
8. Expired insurance on machinery ,$50
9. Factory overhead applied to production at the rate of 75% of direct labor cost.
10. Inventories at the end of the month: work in process, $9,000; finished goods, $6,000
11. Sales on account, $50,000.

Required: General Journal entries to record the transactions. Use a factory overhead control account (not closed until the end of the year) to record both actual and applied overhead.

Exercise 1--Job order cost sheet:

Forge Machine Works collects its cost data by the job order cost accumulation procedure. For Job 642, the following data are available:

Direct Materials Direct Labor

9/14 Issued $ 1,200 Week of Sep. 20 180 hrs @ $6.20/hr

9/20 Issued 662 Week of Sep. 26 140 hrs @ $7.30/hr

9/22 Issued 480

Factory overhead applied at the rate of $3.50 per direct labor hour.

Required:

1. The appropriate information on a job cost sheet.
2. The sales price of the job, assuming that it was contracted with a markup of 40% of cost.