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Job Order Cost Accounting for a Service Company The law firm of Furlan and Benson accumulates costs associated with individual cases, using a job order
Job 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 400 hours of professional (lawyer) time to the Obsidian Co. breech of contract suit to prepare for the trial, at a rate of $240 per hour. 10. Reimbursed travel costs to employees for depositions related to the Obsidian case, $25,600. 14. Charged 260 hours of professional time for the Obsidian trial at a rate of $260 per hour. 18. Received invoice from consultants Wadsley and Harden for $72,700 for expert testimony related to the Obsidian trial. 27. Applied office overhead at a rate of $80 per professional hour charged to the Obsidian case. 31. Paid administrative and support salaries of $37,500 for the month. 31. Used office supplies for the month, $12,700. 31. Paid professional salaries of $177,100 for the month. 31. Billed Obsidian $358,900 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 July 10 July 14 July 18 July 27 July 31 Admin. sal. July 31 Supplies July 31 Prof. sal. July 31 Billed July 31 Cost b. How much office overhead is over- or underapplied? Enter your answer as a positive number. C. Determine the gross profit on the Obsidian case, assuming that over- or underapplied office overhead is closed monthly to cost of services
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