The Polaris Company uses a job-order costing system. The following data relate to October, the first month of the company’s fiscal year:

a. Raw materials were purchased on account, $300,000.

b. Raw materials were issued to production, $290,000 ($228,000 direct materials and $62,000 indirect materials).

c. Direct labour cost was incurred, $110,000; indirect labour cost was incurred, $90,000.

d. Depreciation was recorded on factory equipment, $70,000.

e. Other manufacturing overhead costs were incurred during October, $140,000 (credit accounts payable).

f. The company applies manufacturing overhead cost to production on the basis of $12.60 per machine-hour. There were 30,000 machine-hours recorded for October.

g. Production orders costing $720,000 according to their job cost sheets were completed during October and transferred to finished goods.

h. Production orders that had cost $680,000 to complete according to their job cost sheets were shipped to customers during the month. These goods were sold at 25% above cost. The goods were sold on account.

Required:

1. Prepare journal entries to record the preceding information.

2. Prepare T-accounts for manufacturing overhead and work in process. Post the relevant information above to each account. Compute the ending balance in each account, assuming that work in process has a beginning balance of $42,000.