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Kirpalani Stores manufactures customised household furnishings. The company uses a perpetual inventory system and has a highly labour-intensive production process, so it assigns manufacturing overhead

Kirpalani Stores manufactures customised household furnishings. The company uses a perpetual inventory system and has a highly labour-intensive production process, so it assigns manufacturing overhead based on direct labour cost. Kirpalani expects to incur $2,205,000 of manufacturing overhead costs and estimated direct labour costs of $3,150,000 during 2019. At the end of December 2018, Kirpalani reported work in process inventory (Job 551) of $93,000 The following events occurred during January 2019.

i) Purchased materials on account, $392,000.

ii) Incurred manufacturing wages of $400,000

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