Koushirou Incorporated manufactures special made to order construction equipment. It has three production departments (Cutting, Tooling, and Assembly) and two service departments (Janitorial and Maintenance). In any production department, the job in process is wholly completed before the next job is started. The company operates on a calendar year.

The company uses job order costing since each job is unique. Job names are assigned using a two letter code for the company combined with the number of units contracted for. Before beginning, notice Exhibit 1 included in this company information

- Exhibit 1 shows a post-closing trial balance as of December 31, 2017

Problem 1: Record the Journal Entries for wages. I suggest one for everyone related to the factory, and one for anybody not related to the factory. Separetly, record any payroll taxes due.

An Analysis of Time Cards for the employees showed the following:

Worker1	$9,600
Worker2	$11,200
Worker3	$12,000

Factory Supervisor	$6,000
Factory Janitorial Staff	$3,000
Factory Maintenance Staff	$5,000
Administrative	$10,000

Assume FICA rates are 6.2% + 1.45% = 7.65 and Employee Income Tax Withholding is at 10% of wages. Assume FUTA and SUTA of 4% and 1% respectively on the first $10,000 of wages.

Problem 2: Record the journal entry for letters a thru e below.

Other miscellaneous activity includes:

a. Paid utilities on the factory buiding of $10,000

b. Paid selling and administrative expenses of $5,000

c. Paid FICA, FUTA, SUTA, and Federal Income Taxes withheld as of the end of last year.

d. Monthly depreciation on plant assets were calculated. On an annual basis, the company writes off(rounded to the nearest dollar)

- 5 percent - Factory buildings

- 20 percent - Machinery and Equipment

-20 perent- Office Equipment

e. Adjust the balance of the prepaid insurance account, which represents a two-year premium for a fire insurance policy covering the factory building and machinery. It was paid on the last day of the preceding month and became effective on January 1. (Round your journal entry to the nearest dollar)

EXHIBIT 1

Koushirou Incorporated
Post-Closing Trial Balance
December 31,
		Debit	Credit
Cash		122,500
Accounts Receivable		121,700
Finished Goods		108,750
Work in Process		103,600
Materials		117,000
Prepaid Insurance		104,320
Factory Building		164,000
Accumulated Depr - Factory Building			122,500
Machinery and Equipment		138,000
Accumulated Depr - Machinery and Equip			116,000
Office Equipment		110,500
Accumulated Depr - Office Equipment			107,500
Accounts Payable			102,500
FICA Tax Payable			7,500
FUTA Payable			500
SUTA Payable			100
Employee Income Tax Payable			10,000
Capital Stock			75,000
Retained Earnings			548,77