Job order cost accounting for a service company

The Fly Company provides advertising services for clients across the nation. The Fly Company is presently working on four projects, each for a different client. The Fly Company accumulates costs for each account (client) on the basis of both direct costs and allocated indirect costs. The direct costs include the charged time of professional personnel and media purchases (air time and ad space). Overhead is allocated to each project as a percentage of media purchases. The predetermined overhead rate is 55% of media purchases.

On August 1, the four advertising projects had the following accumulated costs:

	August 1 Balances
Vault Bank	$68,500
Take Off Airlines	20,600
Sleepy Tired Hotels	48,000
Tastee Beverages	29,500
Total	$166,600

During August, The Fly Company incurred the following direct labor and media purchase costs related to preparing advertising for each of the four accounts:

	Direct Labor	Media Purchases
Vault Bank	$48,900		$183,500
Take Off Airlines	21,800		161,400
Sleepy Tired Hotels	96,100		117,900
Tastee Beverages	109,300		88,200
Total	$276,100		$551,000

At the end of August, both the Vault Bank and Take Off Airlines campaigns were completed. The costs of completed campaigns are debited to the cost of services account.

Question Content Area

a. Journalize the summary entry to record the direct labor costs for the month.

b. Journalize the summary entry to record the media purchases for the month.

c. Journalize the summary entry to record the overhead applied for the month.

d. Journalize the summary entry to record the completion of Vault Bank and Take Off Airlines for the month.