Tolman Company had the following balances at the beginning of 2000 :

\begin{tabular}{|c|c|c|}

\hline & Debit & Credit \\

\hline Accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . & $\$ 22,000$ & \\

\hline Supplies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . & 5,000 & \\

\hline Work-in-process services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . & 15,000 & \\

\hline Accounts payable (related to supplies) . . . . . . . . . . . . . . . . . . . . . . . . . . . & & $\$ 3,500$ \\

\hline Salaries and wages payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . & & $35,000 \quad$ \\

\hline Utilities payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . & & 1,200 \\

\hline Rent payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . & & 1,500 \\

\hline

\end{tabular}

Tolman estimates that its total 2000 overhead will amount to $\$ 200,000$. It allocates overhead based on direct labor hours. Tolman estimates that its total 2000 direct labor hours will be 50,000 hours. Because it produces monthly financial statements, Tolman makes adjusting entries at the end of each month. However, over- or underapplied overhead is not closed to Cost of Services until the end of the year.

During January 2000, Tolman had the following transactions:

Jan. 1 Paid rent. Tolman has a two-year, $\$ 72,000$ lease. Rent is payable on the 1st of each month.

4 Paid all utilities payable from 1999.

5 Paid all salaries and wages payable from 1999. $\$ 23,000$ was for direct labor; $\$ 12,000$ was for indirect labor.

8 Paid for all supplies purchased in 1999 10 Used supplies, $\$ 450$.

19 Collected $\$ 15,000$ from a customer for services performed and billed in December 1999 .

23 Purchased supplies, $\$ 600$.

25 Used supplies, $\$ 1,300$

31 Paid all employees for January labor. Total direct labor costs for the month of January were $\$ 25,000$, direct labor hours, 4,000 . Indirect labor costs were $\$ 15,000$

31 Tolman estimates its January utility expenses to be $\$ 1,000$.

31 Tolman completed and billed jobs costing $\$ 40,000$. The company billed customers $\$ 55,000$.

Required: 1. Prepare all journal entries necessary for the month of January.
2. What is the balance in the work-in-process services account at the end of January?
3. Compute the balance in the overhead account on January 31.