Journal Entries Paulson Manufacturing Company uses the perpetual inventory system to account for its manufacturing inventories. The following are Paulson's transactions during July 2016 July 5 Received material costing $5,000 from a supplier. The material was purchased on account. 9 Requisitioned $15,000 of material for use in the factory, consisting of $12,500 of direct material and $2,500 of indirect material. Recorded the factory payroll: $33,750 of direct labor and $3,750 of indirect labor. Incurred various overhead costs totaling $35,000. (Credit Accounts Payable.) Applied $50,000 of manufacturing overhead to the products being manufactured. Completed product casting $40,000 and moved it to the warehouse. Sold goods with a product cost of $7,500 on account for $12,500.