Memory Construction, Inc. is a home builder in Arizona. Memory uses a job order costing system in which each house is a job. Because it constructs houses, the company uses an account titled Construction Overhead. The company applies overhead based on estimated direct labor costs. For the year, it estimated construction overhead of $1,050,000 and total direct labor cost of $2,100,000. The following events occurred during August:

REQUIREMENTS 1&2 of 4 Below

- More info a. Purchased materials on account, $430,000 b. Requisitioned direct materials and used direct labor in construction. Recorded the materials requisitioned. Direct Materials Direct Labor House 402 $ 43,000 52,000 $ 69,000 House 403 32,000 House 404 63,000 58,000 House 405 80,000 57,000 c. The company incurred total wages of $270,000. Use the data from Item b to assign the wages. Wages are not yet paid. d. Depreciation of construction equipment, $6,200 e. Other overhead costs incurred: Equipment rentals paid in cash, $37,000; Worker liability insurance expired, $9,000. f. Allocated overhead to jobs. g. Houses completed: 402, 404 h. House sold on account: 404 for $210,000 Requirement 1. Calculate Memory's predetermined overhead allocation rate for the year. Predetermined overhead = allocation rate . % Requirement 2. Prepare journal entries to record the events in the general journal. (Record debits first, then credits. Exclude explanations from any journal entries.) a. Purchased materials on account, $430,000. Date Accounts Debit Credit a. b. Requisitioned direct materials and used direct labor in construction. Record the materials requisitioned. Date Accounts Debit Credit b. c. The company incurred total wages of $270,000. Use the data from Item b to assign the wages. (Assume the wages have not been paid.) Date Accounts Debit Credit c. d. Depreciation of construction equipment, $6,200 Date Accounts Debit Credit d. e. Other overhead costs incurred: Equipment rentals paid in cash, $37,000; Worker liability insurance expired, $9,000. (Prepare a single journal entry for this event.) Date Accounts Debit Credit e. e. Other overhead costs incurred: Equipment rentals paid in cash, $37,000; Worker liability insurance expired, $9,000. (Prepare a single journal entry for this event.) Date Accounts Debit Credit e. f. Allocated overhead to jobs. Date Accounts Debit Credit f. g. Houses completed: 402, 404 Date Accounts Debit Credit g. g. Houses completed: 402, 404 Date Accounts Debit Credit g. h. House sold on account: 404 for $210,000 Begin by recording the revenue from the sale on account. Do not record the expense related to the sale in this journal entry. We will do that in the next step. Date Accounts Debit Credit h. Now record the cost of goods sold from the sale of house 404. Date Accounts Debit Credit h