Problem 7-51 Tracing Costs in a Job Company (LO 7-2, 3) The following transactions occurred in January at Apex Manufacturing, a custom parts supplier. Apex uses job costing: 1. Purchased $55,500 in materials on account. 2. Issued $3,300 in supplies from the materials inventory to the production department. 3. Paid for the materials purchased in transaction (1). 4. Issued $27,300 in direct materials to the production department. 5. Incurred wage costs of $60,000, which were debited to Payroll, a temporary account. Of this amount, $15,300 was withheld for payroll taxes and credited to Payroll Taxes Payable. The remaining $44,700 was paid in cash to the employees. See transactions (6) and (7) for additional information about Payroll. 6. Recognized $28,000 in fringe benefit costs, incurred as a result of the wages paid in (5). 7. Analyzed the Payroll account and determined that 60 percent represented direct labor; 30 percent, indirect manufacturing labor; and 10 percent, administrative and marketing costs. 8. Paid for utilities, power, equipment maintenance, and other miscellaneous items for the manufacturing plant totaling $34,200. 9. Applied overhead on the basis of 170 percent of direct labor costs. 10. Recognized depreciation of $19,050 on manufacturing property, plant, and equipment. Required: a. Prepare journal entries to record these transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Answer is complete but not entirely correct. No Transaction General Journal Credit Debit 55,500 Materials inventory Accounts payable 55,500 3,300 Manufacturing overhead Control Materials inventory 3,300 55,500 Accounts payable Cash 55,500 27,300 Work in process-Direct materials Materials inventory 27,300 ooooooooooo 5 60,000 Payroll Payroll taxes payable Cash 15,300 44,700 28,000 Payroll Fringe Benefits payable 28,000 Work in processDirect materials Manufacturing overhead Control Administrative and marketing costs Payroll 52,800 26,400 8,800 88,000 34,200 Manufacturing overhead Control Cash 34,200 89,760 Work in process-Overhead Applied manufacturing overhead 89,760 10 10 19,050 Manufacturing overhead Control Accumulated depreciation property, plant, and equipment 19,050 19,050 b. The following balances appeared in the accounts of Apex Manufacturing: Ending Materials Inventory Work-in-Process Inventory Finished Goods Inventory Cost of Goods Sold Beginning $58,275 15,075 64,050 $ 53,400 107,775 Prepare T-accounts to show the flow of costs during the period. Answer is not complete. Beg. bal. Materials Inventory 58,275 3,300 55,500 27,300 Beg. bal. 4. Work-in-Process Inventory 15,075 27,300 Goods Completed 52,800 89,760 9. End. bal. 83,175 End. bal. 184,935 Beg. bal. Beg. bal. Applied Manufacturing Overhead 0 89,760 9. Manufacturing Overhead Control 0 3,300 26,400 34,200 19,050 End. bal. 89,760 End. bal. 82.950 Problem 7-51 Tracing Costs in a Job Company (LO 7-2, 3) The following transactions occurred in January at Apex Manufacturing, a custom parts supplier. Apex uses job costing: 1. Purchased $55,500 in materials on account. 2. Issued $3,300 in supplies from the materials inventory to the production department. 3. Paid for the materials purchased in transaction (1). 4. Issued $27,300 in direct materials to the production department. 5. Incurred wage costs of $60,000, which were debited to Payroll, a temporary account. Of this amount, $15,300 was withheld for payroll taxes and credited to Payroll Taxes Payable. The remaining $44,700 was paid in cash to the employees. See transactions (6) and (7) for additional information about Payroll. 6. Recognized $28,000 in fringe benefit costs, incurred as a result of the wages paid in (5). 7. Analyzed the Payroll account and determined that 60 percent represented direct labor; 30 percent, indirect manufacturing labor; and 10 percent, administrative and marketing costs. 8. Paid for utilities, power, equipment maintenance, and other miscellaneous items for the manufacturing plant totaling $34,200. 9. Applied overhead on the basis of 170 percent of direct labor costs. 10. Recognized depreciation of $19,050 on manufacturing property, plant, and equipment. Required: a. Prepare journal entries to record these transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Answer is complete but not entirely correct. No Transaction General Journal Credit Debit 55,500 Materials inventory Accounts payable 55,500 3,300 Manufacturing overhead Control Materials inventory 3,300 55,500 Accounts payable Cash 55,500 27,300 Work in process-Direct materials Materials inventory 27,300 ooooooooooo 5 60,000 Payroll Payroll taxes payable Cash 15,300 44,700 28,000 Payroll Fringe Benefits payable 28,000 Work in processDirect materials Manufacturing overhead Control Administrative and marketing costs Payroll 52,800 26,400 8,800 88,000 34,200 Manufacturing overhead Control Cash 34,200 89,760 Work in process-Overhead Applied manufacturing overhead 89,760 10 10 19,050 Manufacturing overhead Control Accumulated depreciation property, plant, and equipment 19,050 19,050 b. The following balances appeared in the accounts of Apex Manufacturing: Ending Materials Inventory Work-in-Process Inventory Finished Goods Inventory Cost of Goods Sold Beginning $58,275 15,075 64,050 $ 53,400 107,775 Prepare T-accounts to show the flow of costs during the period. Answer is not complete. Beg. bal. Materials Inventory 58,275 3,300 55,500 27,300 Beg. bal. 4. Work-in-Process Inventory 15,075 27,300 Goods Completed 52,800 89,760 9. End. bal. 83,175 End. bal. 184,935 Beg. bal. Beg. bal. Applied Manufacturing Overhead 0 89,760 9. Manufacturing Overhead Control 0 3,300 26,400 34,200 19,050 End. bal. 89,760 End. bal. 82.950