Problem 7-58 (Algo) 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 $55,200 in materials on account. 2. Issued $3,000 in supplies from the materials Inventory to the production department. 3. Paid for the materials purchased in transaction (1) 4. Issued $27,000 in direct materials to the production department. 5. Incurred wage costs of $57,000, which were debited to Payroll, a temporary account. Of this amount, $15,000 was withheld for payroll taxes and credited to Payroll Taxes Payable. The remaining $42,000 was paid in cash to the employees. See transactions (6) and (7) for additional information about Payroll. 6. Recognized $25,000 in fringe benefit costs, incurred as a result of the wages paid in (5). This $25,000 was debited to Payroll and credited to Fringe Benefits Payable. 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 $33,900. 9. Applied overhead on the basis of 170 percent of direct labor costs. 10. Recognized depreciation of $18,750 on manufacturing property, plant, and equipment Required: a. Prepare journal entries to record these transactions. b. The balances that appeared in the accounts of Apex Manufacturing are shown as follows. Ending Materials Inventory Work-in-Process Inventory Finished Goods Inventory Cost of Goods Sold Beginning $57,825 14,625 63,750 $ 52,800 106,275 Required A Required B Prepare T-accounts to show the flow of costs during the period. Work-in-Process Inventory Beg. Bal 1 Beg. Bal. Materials Inventory 57,825 55,200 3,000 2 27,000 4. 5. 83,025 Goods Completed End. Bal. End. Bal. Manufacturing Overhead Control Applied Manufacturing Overhead Beg. Bal. Beg. Bal. End. Bal. Accounts Payable Cash Beg. Bal. Beg. Bal. End. Bal. End. Bal. Payroll Payroll Taxes Payable Beg. Bal. Beg. Bal. End. Bal. End. Bal. Fringe Benefits Payable Administrative and Marketing Costs Beg. Bal. Beg. Bal. End. Bal. End. Bal. Accumulated Depreciation-Property, Plant, and Equipment Beg. Bal. Finished Goods Beg. Bal. Goods Completed + End. Bal. End. Bal. Cost of Goods Sold Beg. Bal. Goods Sold End. Bal