The company had the following transactions and events during its first year of operations. Estimated overhead for the year was $770,000; estimated direcl labor cost for the year was $350,000.

a) purchased materials on account, $5647,000

b) requisitioned materilas for production as follows: direct materials - 85 percent of purchases, indirect materials - 15 percent of purchases

c) direct labor for production is $331,000, indirect labor is $125,000

d) overhead incurred (not including materials or labor): $529,000. (Assume miscellaneous payables)

e) overhead is applied to production based on direct labor cost at the rate of _____ percent.

f) goods costing $976,000 were completed during the period

g) goods costing $513,200 were sold on account for $776,000

Required:

1. Prepared the journal entries to record these transactions for the year.

2. Prepare the journal entries to prorate the over-or underapplied overhead to the appropriate accounts assuming that amount of over-/under-applied overhead is immaterial.