Oslo Company produces large quantities of a standardized product. The following information is available for its production activities for May.

Additional information about units and costs of production activities follows.

During May, 10,000 units of finished goods are sold for $ 120 cash each. Cost information regarding finished goods follows.
Beginning finished goods inventory . . . . . . . . . . . $ 148,400
Cost transferred in from production . . . . . . . . . . . 389,740
Cost of goods sold . . . . . . . . . . . . . . . . . . . . . . . . (474,540)
Ending finished goods inventory . . . . . . . . . . . . . $ 63,600

Required
1. Prepare journal entries dated May 31 to record the following May activities:
(a) Purchase of raw materials,
(b) Direct materials usage,
(c) Indirect materials usage,
(d) Factory payroll costs,
(e) Direct labor costs used in production,
(f) Indirect labor costs,
(g) Other overhead costs€” credit Other Accounts,
(h) Overhead applied,
(i) Goods transferred to finished goods,
(j) Sale of finished goods.
2. Prepare a process cost summary report for this company, showing costs charged to production, unit cost information, equivalent units of production, cost per EUP, and its cost assignment and reconciliation.
Analysis Component
3. This company provides incentives to its department managers by paying monthly bonuses based on their success in controlling costs per equivalent unit of production. Assume that production over-estimates the percentage of completion for units in ending inventory with the result that its equivalent units of production in ending inventory for May are overstated. What impact does this error have on bonuses paid to the managers of the production department? What impact, if any, does this error have on these managers€™ Junebonuses?

Raw materials Factory overhead incurred Beginning inventory .32.000 Indirect materials used. 40,560 Raw materials purchased (on credit) 221,120 Indirect labor used . . . . . . . . . . . . .. 36320 Direct materials used . (197,120) Other overhead costs...34,432 Indirect materials used(40,560) Total factory overhead incurred...$111,312 Ending inventory Factory payroll Direct labor used ..$123.680 Tota Factory overhead applied (90% of direct labor cost) I factory overhead applied .$111.312 36,320 $160,000 Indirect labor used Toal payroll cost (paid in cash)$160,000 Units Costs Beginning goods in process inventory... Ending goods in process inventory. 3.000 Status of ending goods in process inventory 4,000 Beginning goods in process inventory Direct labor....2.820 rect materials added. Direct labor added . . . . . . . . . . . . . . . . Overhead applied (90% of direct labor) Total costs Ending goods in process inventory Factory overhead..2.538 $ 8,238 197,120 123,680 111.312 $440.350 $ 50,610 Materials-percent complete . . . . . . . . . . Labor and overhead-Percent complete . 100% 25%