The Collins Company uses a job-order costing system and applies manufacturing overhead cost to jobs on the basis of the cost of materials used in production. At the beginning of the most recent year, the following estimates were made as a basis for computing the predetermined overhead rate for the year: Manufacturing overhead cost: $200,000 Direct materials cost $160,000 The following transactions took place during the year (all purchases and services were acquired on account); Required: Prepare journal entries to record the information below. TRANSACTION JOURNAL ENTRY Raw materials purchased: $86,000 raw material 86000 cash 86000 Raw materials requisitioned for use in production (all direct materials): $98,000. work in process 98000 raw material inventory 98000 Utility costs incurred in the factory: $15,000 manufacturing over head 15000 cash 15000 4 Direct labour: $175,00 Salaries and wages incurred as follows: work in process 175,000 Manufacturing overhead 70,000 Indirect labour:$70,00 salaries expense 125,000 Administrative salaries: $125,000 Cash Maintenance costs incurred in the factory: $15,000. manufacturing over head 15000 cash 15000 370,000 Advertising costs incurred: $89,000. Advertising expenses 89000 cash 89000 4 continues Depreciation recorded for the year: $80,000, of which 80% relates to factory assets and the remainder relates to selling and administrative assets. manufacturing overhead 80000*0.8= 64000 dep expense 16000 accumulated dep 80000 Rental cost incurred on buildings manufacturing overhead 70000*0.75= 52500 $70,000 (75% of the space is occupied rent expense 17500 by the factory, and 25% is occupied by sales and administration) cash 70000 Miscellaneous expense 11000 Miscellaneous selling and administrative costs incurred: $11,000. cash Manufacturing overhead cost was work in Process 122,500 applied to jobs as per company policy. manufacturing Overhead Cost of goods manufactured for the year: $500,000 cost of goods 500000 work in process 500000 Sales for the year (all on account): $1,000,000. These goods cost $600,000 to manufacture cash 1000000 sales 1000000 11000 cost of goods sold 600000 finished goods 600000 122,500 4 continues