Oct 1. Borrowed $130,000 from ABC Bank on a note payable.

1. Purchased 5,000 square feet of oak on account at $25 per square foot.

2. Purchased 50 gallons of glue on account at $36 per gallon (indirect material).

4. Requisitioned 3,500 square feet of oak and 30.5 gallons of glue for production.

15. Paid factory utility bill, $15,230 in cash.

20. Received a bill for Novembers insurance cost for the manufacturing property and equipment, $3,500. This

amount has not yet been paid.

25. Incurred Research & Development expense on account, $4,500.

28. Incurred factory payroll costs of $187,900 (not yet paid). Of this amount, $46,000 were indirect labor costs; direct

labor personnel earned $22 per hour.

29. Incurred and paid other factory overhead costs, $13,400.

29. Incurred selling and administrative expenses on account, $13,510.

30. Declared and paid a $1,200 cash dividend.

31. Record $8,200 of depreciation on manufacturing equipment for October.

31. Allocated factory overhead to production on the basis of direct labor- hours.

31. Completed goods costing $146,000 manufactured during the month.

31. Sales on account in October were $132,200. The cost of goods sold was $112,000.

31. Recorded $2,300 depreciation on office equipment for October.

31. Customers paid $100,500 on account.

31. Paid payroll, $186,000.

31. Paid accounts payable, 49,000.

31. Prepaid insurance expired, 4,000.

31. Interest accrued is $100.

31. Calculate the overallocated or underallocated overhead and close this amount to the Cost of Goods Sold account.

Required 1. Compute the firms factory overhead allocation rate for the year. 2. Prepare journal entries to record October transactions. 3. Post the journal entries to the appropriate general ledger accounts. 4. Prepare a trial balance for October. 6. Prepare a multiple-step income statement and a classified balance sheet for October.