Kim's Asphalt does driveway and parking lot resurfacing work for large commercial clients as well as small residential clients. An inventory of materials and equipment is on hand at all times so that work can start as quickly as possible. Special equipment is ordered as required. On May 1, the Materials and Equipment Inventory account had a balance of $41,000. The Work-in-Process Inventory account is maintained to record costs of work not yet complete. There were two such jobs on May 1 with the following costs. Materials and equipment Direct labor Job 27. Job 33 Highlands Hall Pine Ridge Estates, $16,125 14,000 $53,000 26,500 10,600 Overhead (applied) 5,600 Overhead has been applied at 40 percent of the costs of direct labor. During May, Kim's Asphalt started two new jobs. Additional work was carried out on Jobs 27 and 33, with the latter completed and billed to Pine Ridge Estates. Details on the costs incurred on jobs during May follow. Materials and equipment Job Direct labor (wages payable) $3,500 $5,300 27 33 34 35 $5,100 $3,400 5,000 7,250. 6,400 2,100 Other May Events 1. Received $13,000 payment on Job 24 delivered to customer in April. 2. Purchased materials and equipment for $9,900 on account. 3. Billed Pine Ridge Estates $135,000 and received payment for $100,000 of that amount. 4. Determined that payroll for indirect labor personnel totaled $700. 5. Issued supplies and incidental materials for current jobs costing $205. 6. Recorded overhead and advertising costs for the operation as follows (all cash except equipment depreciation). Property taxes $600 Property taxes Storage area rental $600 725 Truck and delivery cost 370 Advertising and promotion campaign 650 Inspections 250 Telephone and other miscellaneous. Equipment depreciation 375 500 Required: a. Prepare journal entries to record the flow of costs for operations during May. b. Calculate the amount of over- or underapplied overhead for the month. c. Determine inventory balances for Materials and Equipment Inventory and Work-in-process inventory. Complete this question by entering your answers in the tabs below. Required A Required B Required C Prepare journal entries to record the flow of costs for operations during May. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list View journal entry worksheet No Transaction General Journal A 1. Cash Accounts receivable B 02 2 Materials and equipment inventory Accounts payable Debit Credit 13,000 13,000 9,900 9,900 *DE M Pray 2 of 2 Next >