Prepare journal entries to record transactions a through h.

a. Raw materials purchased on credit, $90,000. b. Direct materials used, $39,500. Indirect materials used, $18,000. c. Direct labor used, $40,000. Indirect labor used, $20,000. (Record using Factory Wages Payable.) d. Paid cash for other actual overhead costs, $7,625. e. Applied overhead at the rate of 125% of direct labor cost. f. Transferred cost of jobs completed to finished goods, $65,000. g. Sales of jobs on credit was $92,800. h. Cost of jobs sold was $65,000.

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Tasty Bakery applies overhead based on direct labor costs. The company reports the following costs for the year: direct materials, $690,000; direct labor, $3,400,000; and overhead applied, $2,720,000.

1. Determine the companys predetermined overhead rate for the year. 2. The ending balance of its Work in Process Inventory account was $75,000, which included $24,000 of direct labor costs. Determine the direct materials costs in ending Work in Process Inventory.