Scrap materials with estimated value of $6,000 are gathered and separated from work-in process. They are subsequently sold for $6, 200.

Make the entries under each of the following assumptions:

a. Revenue from sale of scrap is recognized only upon sale as

(1) other income

(2) as adjustment to factory overhead

(3) as reduction in cost of a particular job

b. Scrap is recognized upon separation there from work-in process and revenue is treated as

(1) adjustment to factory overhead

(2) as reduction in the cost of a particular job